International Paper will close two pulp and paper mills in Coastal Georgia, a move that will put about 1,100 employees out of work, the company announced Thursday.
Mills in Savannah and Riceboro will shut down by the end of next month, as will the company's Savannah packaging facility. The combined changes will result in a net reduction of International Paper's annual containerboard capacity by about 1 million tons.
The company will offer severance packages along with outplacement assistance for eligible employees, said Tom Hamic, president of International Paper's North America Packing Solutions business.
"We understand how deeply these decisions affect our employees, their loved ones, and the surrounding communities," he said. "We are committed to supporting both our employees and customers as we navigate this transition."
"These mill closures will undoubtedly deal a devastating blow not only to Georgia’s timber industry, but to the economic fabric of the entire Southeast Georgia region," added Georgia House Speaker Jon Burns, R-Newington.
The pulp and paper industry has been buffeted by a long-term reduction in demand for its products. The number of mills in Georgia has fallen from 18 at the height of production in 1977 to just nine with Thursday's closure announcements, Marshall Thomas, president of Albany-based F&W Forest Services, told an audience of political and ag business leaders at the annual Ag Issues Summit at the Georgia National Fairgrounds in Perry.
Thomas said Georgia lawmakers are working to increase demand for timber products, including a state Senate study committee that began meeting last year to explore developing sustainable aviation fuel from biomass, which has become popular in Europe.
"Why aren't we doing this?" he said. "The world wants green stuff ... and we've got some of the greatest forestry in the world."
Thomas said another way to increase demand for timber is being worked on at the federal level. While the U.S. Environmental Protection Agency's renewable fuel standard is aimed at increasing the use of renewable fuels to reduce greenhouse gas emissions, it bans the use of commercially produced trees in producing those fuels.
"If we could get that relaxed to include trees, it would go a long way," he said.
"I, along with each member of our delegation in the House, remain committed to working tirelessly with our state leaders, federal partners and timber producers to navigate this difficult transition, secure new employment opportunities for the hundreds of citizens impacted by the closures and safeguard the long-term strength and viability of Georgia’s timber industry," Burns added.