Quebec-based Cascades announced Tuesday afternoon that it’s closing a corrugated medium manufacturing facility in Niagara Falls, New York. Production will end by Sept. 3, and 123 employees will be affected.
The company says this move aligns with goals to optimize its packaging business. It recently combined its containerboard and specialty products businesses into a single segment. Cascades anticipates $5 million in costs related to the closure.
"This is a difficult decision, but one that is an essential part of our focus on optimizing the performance of our Packaging sector," said Jean-David Tardif, executive vice president of packaging, in a news release.
Aging assets and high operating costs also contributed to the decision to close the mill, said Hugo D’Amours, vice president of communications, public affairs and sustainable development, via email Wednesday morning. The nearly century-old facility is running at about 74% capacity, and operating costs are high, reports The Buffalo News. The containerboard production facility has a capacity of 200,000 short tons per year, which will be transferred to other facilities, according to D’Amours.
Cascades intends to “work closely” with employees during the transition and hopes they will apply to open positions at other locations, D’Amours said. “For those who don’t want to relocate, we will provide job search support.”
During the company’s first-quarter earnings call in May, CEO Hugues Simon described a production disruption at the Niagara Falls complex due to the third-party steam supplier experiencing mechanical issues. “Both mills resumed production quickly, but are currently limited to approximately 85% of their normal capacity,” Simon said. At the time, Cascades aimed for operations at Niagara Falls to return to normal by the end of Q2.
Cascades temporarily idled a second machine at this site in 2022 and then permanently closed it in 2023. Last year, the company announced it would close its containerboard converting plants in Newtown, Connecticut, and Belleville, Ontario, and it would not restart an idled corrugated medium mill in Trenton, Ontario.
Cascades’ announcement marks the sixth major U.S. containerboard facility closure disclosed in 2025 so far. That represents a loss of roughly 6% of North American containerboard capacity, according to a July 8 note to investors from Michael Roxland, Truist Securities senior paper and packaging analyst.
The closures are expected to be positive for rebalancing supply and demand dynamics, and the industry could be positioned to raise prices later this year, Roxland said. Numerous analysts believe the capacity reduction could help to rebalance the containerboard market, following years of oversupply in North America and globally.
