PCA to shut down paper machines at Washington containerboard mill

Packaging Corp. of America (PCA) has revealed plans to reconfigure its containerboard mill in Wallula, Washington, in the face of what the company describes as a challenging and worsening cost environment at the facility.

By the end of the first quarter of 2026, PCA plans to shut down its No. 2 paper machine and kraft pulping facilities at the Wallula mill and will continue to operate its No. 3 paper machine and recycled pulping facilities. The moves are expected to impact 200 workers.

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After the shutdowns, the mill will have the capacity to produce 285,000 tons of recycled linerboard and corrugated medium per year, removing 250,000 tons of annual production capacity from the mill.

This year, the Wallula mill is expected to produce about 400,000 tons of containerboard.  

“We face a challenging and worsening cost environment at the Wallula mill,” PCA CEO Mark Kowlzan says. “Wood fiber and purchased power costs are by far the highest in our system, making the currently configured mill no longer competitive.”

The No. 2 paper machine has approximately 140,000 tons of annual corrugated medium capacity but has been idle since May. The new configuration is expected to lower production costs in Wallula by about $125 per ton compared with 2025 levels thanks to an improved cost structure and utilization rate. PCA also plans to replace the 250,000 tons of reduced capacity with production enhancements at other mills in its network starting in the fourth quarter of 2026.

“By operating as a single-machine recycled mill, we will streamline operations at the facility and significantly lower our cost of production while continuing to produce high-quality containerboard for our plants and customers,” Kowlzan says. “We have significantly invested in the [No. 3] machine and its capabilities after we converted it to containerboard in 2018. Moving some production to lower-cost PCA facilities where we are investing in production improvements will further optimize our mill system, resulting in even greater efficiencies.”

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The eliminated capacity eventually is expected to be replaced, as PCA expects about 140,000 tons per year of linerboard capacity to come up at its containerboard mill in Jackson, Alabama. The company also says additional improvements at acquired Greif facilities and at its containerboard mill in Counce, Tennessee, will replace the remaining capacity when needed.

PCA currently operates 10 mills and 92 corrugated products plants and related facilities.

“We remain committed to growing with our customers and will have sufficient containerboard capacity to do so,” PCA President Tom Hassfurther says.