Domtar Corp. will restart its Howe Sound Pulp and Paper mill in mid-October after reaching an agreement with the Government of British Columbia, reversing an indefinite idling announced in August that affected approximately 400 direct jobs

The restart is contingent on Unifor Local 1119 members ratifying a new collective agreement, with a vote scheduled for next week. If approved, the mill will resume operations following a planned maintenance shutdown. The mill is expected to be in full production by November 1, 2026.

Background: indefinite idling in August

On August 20, 2026, Domtar announced the indefinite idling of the Howe Sound mill and affiliated Bayview Fibre chipping facility in Port Mellon. The company said the decision would affect approximately 400 employees and remove around 380,000 metric tonnes per year of NBSK pulp capacity from the market.

Domtar attributed the decision to reduced demand from Asia, unprecedented and sustained poor pricing for pulp globally, and a decline in affordable domestic fibre. The company said it had invested nearly C$500 million since acquiring the mill in 2010, including the construction of the Bayview Fibre facility.

Provincial intervention

Following the August announcement, the B.C. government appointed Don Wright, former deputy minister to the premier and head of the provincial public service, and Don Kayne, former president and CEO of Canfor, to work with Domtar on options for keeping the mill operating. Domtar accepted the province's offer to return to discussions.

Specific financial terms of the agreement have not been publicly disclosed. Unifor Western Regional Director Gavin McGarrigle stated that the arrangement included energy rebates and adjusted pricing aimed at improving the mill's operating economics.

Domtar said it welcomed the government's decision to work collaboratively with the Howe Sound mill while British Columbia's forest sector faces significant pressures. The company said that, with government support in place, scheduled maintenance would proceed as planned, followed by the mill's restart.

Outlook

The agreement provides a path for Howe Sound to return to production, but the underlying challenges that prompted Domtar's August decision remain.

Fiber availability and costs, pulp pricing, operating economics and global market conditions continue to present challenges for British Columbia's pulp sector. Domtar's original announcement said the company would continue to monitor market conditions, domestic fiber availability and the broader business environment.

The immediate next step is the Unifor ratification vote, followed by scheduled maintenance and the planned restart of the Port Mellon mill.