Domtar Corporation has announced the indefinite idling of its Howe Sound Pulp and Paper mill and affiliated Bayview Fibre chipping facility in Port Mellon, British Columbia. The decision, driven by sustained adverse market conditions and structural challenges in fiber supply, will affect approximately 400 employees.

Operations will wind down over the coming weeks, with employees’ last day scheduled for October 19, 2026. Domtar is characterizing the move as an “indefinite idling,” with equipment to be maintained in a condition that could allow the mill to restart if market conditions improve.

The Government of British Columbia and several stakeholders, however, have described the outcome as a permanent closure.

Reasons for the idling

Domtar cited three key factors behind the decision:

• Reduced demand from Asia for northern bleached softwood kraft (NBSK) pulp, an important export market for the mill.
• Unprecedented and sustained poor pulp pricing globally, which has significantly weakened the mill’s economics.
• A decline in affordable domestic fiber availability, increasing input costs and limiting operational flexibility.

Domtar has invested approximately $500 million since acquiring the mill in 2010, including investments in the Bayview Fibre facility, to improve efficiency and fiber utilization. However, the company concluded that current and expected market conditions do not support continued operations.

Impact on production and market

The idling will remove approximately 380,000 air-dried metric tonnes (ADMT) per year of NBSK pulp capacity from the global market.

The decision adds to a series of pulp and forestry-sector curtailments and closures in British Columbia and highlights the continuing challenges facing higher-cost North American softwood pulp producers amid weak pricing, changing global demand and constrained fiber availability.

Support for employees and community

Domtar said it recognizes the significant impact of the decision on employees and the Sunshine Coast community and will work with affected employees, unions and government partners through the transition.

The Government of British Columbia has also indicated that it will work with local leaders, labour representatives and affected workers to help provide support following the announcement.

Domtar

Domtar is a manufacturer of pulp, paper, packaging, tissue and wood products, with operations across North America. The company serves customers in a range of markets and focuses on delivering sustainable products and solutions for consumer, industrial and packaging applications.