Verso Corp. to Idle Duluth and Wisconsin Rapids Paper Mills

SEATTLE (Scrap Monster): Miamisburg, Ohio-based Verso Corp. announced plans to idle two of its mills in Upper Midwest.

The company’s paper mills in Duluth, Minnesota, and Wisconsin Rapids, Wisconsin will be idled for an indefinite period. The Duluth mill will be idled by end-June and Wisconsin Rapids mill by end-July this year. Together, it will likely result in layoff of around 1000 employees. The decision is mainly driven by unprecedented market on account of Covid-19 pandemic.

ALSO READ: Verso Corp. Results Take a Hit From Challenging Market Conditions

According to company press release, the Covid-19 pandemic has led to accelerated decline in graphic paper demand. The use of print advertising in various industries, especially retail, sports, entertainment and tourism has seen major decline on account of stay-at-home orders. In accordance with industry estimates, the North American printing and writing demand witnessed 38% year-on-year decline in April this year. The operating rates are expected to fall below 70% in Q2 this year.

Verso Corp. will explore viable and sustainable alternatives for both the mills. These include restarting the mill upon improvement in market conditions, marketing for sale or closing the mills permanently.

Adam St. John, President and Chief Executive Officer hoped that the idling of the above facilities will help the company to improve its free cash flow.