Verso Corporation will permanently close its paper mill in Luke, Maryland, in response to the continuing decline in customer demand for the grades of coated freesheet paper produced at the mill, along with rising input costs, a significant influx of imports, and rising compliance costs and infrastructure challenges associated with recent environmental regulation changes.
The closure, which is expected to be complete by June 30, will reduce Verso's coated freesheet production capacity by approximately 450,000 tons, reducing total annual paper production capacity to approximately 2.7 million tons.
"It is unfortunate that we had to make the decision to close the Luke Mill, but the continuing decline in demand for the grades of paper manufactured there left us no choice but to close this facility that has struggled with profitability for a number of years," said Verso Interim Chief Executive Officer Leslie T. Lederer. "The company explored the possibility of producing alternate grades of paper products but the conclusion remained the same – we could not achieve profitability at the mill in today's market environment. Consistently matching the supply of our graphic paper products with customer demand for these products, reducing our costs and rapidly diversifying our product portfolio into growing markets remain essential drivers for Verso's long-term success, and we continue to vigorously pursue these objectives."
Approximately 675 employees will be impacted by the closure of the Luke Mill.