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Kap Paper Makes Urgent Call to Ottawa to Match Provincial Support and Protect 2500 Jobs in Northeastern Ontario

Kap Paper reiterates its request for immediate federal action to stabilize Canada’s forestry supply chain-the backbone of the federal housing plan. The company urges the Government of Canada to work with Ontario and industry on practical, near-term steps to keep the integrated system of pulp and paper mills, by-product markets, and sawmills intact, while protecting 2,500 jobs in Northeastern Ontario.
Today’s call supports a letter issued earlier this week by the Federation of Northern Ontario Municipalities (FONOM) and the Northwestern Ontario Municipal Association (NOMA). Kap Paper is the backbone of forest operations in Northeastern Ontario. A financially viable Kap Paper enabled by a new cogeneration facility and a corresponding Power Purchase Agreement will provide regional sawmills with a facility that uses wood chips, sawmill residues, bark, and tree debris. A strong forestry industry is built on a pulp and paper facility.
The company acknowledges and appreciates recent steps by the Province of Ontario, including a $6 million loan extension and the establishment of a structured working table with provincial and federal officials to advance long-term solutions such as innovation and cogeneration. Kap Paper looks forward to working with Ottawa on this constructive, solutions-focused process.

Kap Paper’s ask is straightforward and urgent: act now to keep the supply chain intact so pulp and paper mills remain financially viable; Canadian lumber remains affordable and available, supporting Canada’s housing targets; and Northern communities, employees, and families continue to have a great place to live, work, and play.

The investment in Kap Paper is a long-term investment in renewal energy, affordable paper exported across the globe and a domestic supply of lumber for affordable housing. What Ottawa can do now:

  • Commit to matching Ontario’s funding for a cogeneration facility and Power Purchase Agreement.
  • Address duties and tariff pressures that unfairly penalize Canadian producers.
  • Provide proportional forestry funding equivalent to British Columbia and Quebec.

“Every mill job supports multiple others-in trucking, maintenance, contractors, and local services,” said Terry Skiffington, Kap Paper CEO. “Stability in Ontario’s Northeast means stability for communities. It also means better climate outcomes: managed forests and healthy markets for biomass reduce wildfire fuel loads and the associated social and financial costs. Kap Paper has the best workforce in the North. Our employees want to have long-term, stable jobs.”

Kap Paper is a competitive producer of newsprint. Global price for newsprint and other grades of paper markets are gradually improving, and there is an expectation of slow, steady growth.
It is critical that the Government of Canada and the Government of Ontario provide transitional support to Kap Paper, enabling construction of a cogeneration facility and a Power Purchase Agreement. With these investments, Canada and Ontario will ensure a stable forest industry in Northeastern Ontario. Sawmills will be able to make significant investments to increase efficiency. Reducing residual forest biomass will help lower the intensity and incidence of wildfires. Jobs will be maintained, and families and communities will continue to thrive in one of the most beautiful regions in Canada.
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