Japanese-owned forestry firm Juken New Zealand (JNL) has confirmed the closure of its Northland Mill in Kaitāia with the loss of around 60 jobs, after the government declined to back a regional rescue package that included plans for a woody biomass biofuel operation at the site.
Northland Regional Council, Far North District Council and economic development agency Northland NZ had urged central government to invest in proposals to keep the veneer mill running, warning its loss would devastate the Far North town of around 6,000 people.
Alongside a modernised mill, the councils' plan proposed a second operation converting waste and low-grade wood into woody biomass biofuel, which was expected to employ some of the existing workforce.
Acting prime minister David Seymour rejected calls for government investment this week, and JNL confirmed the closure the following day. Director Yasufumi Tsuchiya said the company had concluded consultation with employees and would shut the mill by 21 August, with production winding down over the coming weeks.
An extensive sale process, run by PwC with expressions of interest open until late May, failed to produce a viable buyer.
"We recognise the significance of this announcement for our employees, their whānau and the wider Northland community," Tsuchiya said. He added that JNL remained open to potential buyers and to exploring opportunities for the site's land and assets.
The closure breaks an integrated processing chain in which the two Kaitāia mills between them used the full log. "The top of a log is refined for the Triboard product, and the middle for veneers and mulch," said Workers First Union organiser Marcus Coverdale. "Without a buyer found for the Northland Mill, we'll be taking the top of the log for Triboard and sending the other raw two-thirds overseas without any value added."
JNL's neighbouring Triboard mill — which runs an on-site biomass energy plant fuelled by its own residues — is unaffected by the closure, and a sale process for that business as a going concern continues. The site employs around 140 people.
The decision extends a wave of wood processing closures across regional New Zealand, with owners widely citing high energy costs: recent losses include the paper line at Kinleith Mill in Tokoroa, Eves Valley Sawmill in Tasman, and the Karioi Pulpmill and Tangiwai Sawmill in Ruapehu.
The squeeze sits oddly against rising demand for wood fuel elsewhere in the energy system — Genesis Energy and Nature's Flame agreed in April to advance supply of up to 300,000 tonnes a year of torrefied biomass to the Huntly power station by FY28, as generators look to displace coal.
Biomass plan fails to save NZ Kaitāia mill
