The downturn in the paper industry has forced Kruger Inc. to cut newsprint production by 25,000 tonnes in the first half of 2009 in a move that seeks to avoid layoffs by spreading around the down time.
The production cuts will affect two mills in Quebec and one in Corner Brook, N.L., the private company said Wednesday.
"It will involve sporadic production reductions spread out over the next six months at our three plants, so it's not significant enough to prompt layoffs," said company spokesman Jean Majeau.
The 105-year-old company employs 9,000 people throughout Canada, the United States and the United Kingdom.
Kruger produces one million tonnes of newsprint annually, so the output cutback represents a reduction of 2.5 per cent on an annualized basis.
Majeau said the company will use the downtime to repair equipment.
In a news release, Kruger said the reduced production will help to "rebalance its order book to capacity."
The newsprint industry has been battered by slumping demand from the United States, where the recession and a shift to online news and advertising has weakened the economics of the newspaper industry and therefore demand for paper.
AbitibiBowater Inc. (TSX:ABH), the world's largest newspaper producer, recently announced plans to close its paper mill in Grand Falls, N.L., affecting nearly 800 jobs.
The decision prompted the N.L. government to move to expropriate the company's resource rights and hydro assets in the region.
Published reports indicated Wednesday that AbitibiBowater will close its plant in Gatineau, Que., for five weeks, affecting 530 workers.