Kap Paper turning profit, no longer losing money

Kap Paper is now generating enough cash to fund its own operations and no longer relies on outside funding. Lydia Chubak reports.

Kapuskasing Mayor Dave Plourde said Kap Paper is no longer losing money and is generating enough cash to fund its own operations.

The update comes after Kap Paper officials announced the mill is no longer relying on outside funding to keep operating.

Plourde called the news positive for the community but said he’s remaining cautious because conditions in the forestry sector can change quickly.

“Getting to here, it was difficult. It was a lot of work, but we have to remain cash positive. In the world that we live in today, things change rapidly, and I think it’s important to be cautious,” said Plourde.

Plourde told CTV News, reaching this point required significant effort from employees, management and government partners.

Plourde said the mill continues to produce newsprint, but the company is planning to transition to a different product used in the building and housing sectors.

Plourde said changing market conditions, including mill closures elsewhere and higher paper prices, have helped improve the company’s financial position.

“Markets have changed, probably through a combination of closures elsewhere and rising paper prices, and people working really hard at the facility to change where we are today,” said Plourde.

“I think that’s a huge step forward, and we have to continue to do that until such time as we’re able to pivot to MDF.”

Plourde said he expects more details about the company’s planned transition in the coming months.

In a statement to CTV News, Industry Minister Melanie Joly said the company plays an important role in the area’s economy.

“Kap Paper is a regional economic driver and provides key integrated support to northeastern Ontario’s softwood lumber industry,” the statement said.

“This investment will help the company define its plan to manufacture higher-value products to diversify revenue streams, stabilize demand for fibre and maximize the economic output of harvested timber. For Ontario, developing these products will help create and maintain jobs, and strengthen regional economies.”