Paper Mill Struggles with Higher Raw Material Prices

An Oregon-based company that recycles newsprint is poised to close its Pomona operation in the face of rising recovered fiber and higher energy prices, as well as declining demand for its product.

Oregon-based Blue Heron Paper said China's increasing demand for waste paper is edging the company out.

"The lion's share of it is going overseas to China - they are willing to pay so much more for it," said Mike Siebers, Blue Heron's president and chief executive. "We can't compete."

The Pomona facility ceased operations March 7.

"We just told our paper suppliers that's it's not economical for us to operate the mill unless they are willing to sell us old newspapers at a reasonable price," Siebers said.

Increased export demand for waste paper has driven up pricing in the Los Angeles Basin by more than 30 percent over the past five months, he said.

"With no change in sight, it doesn't make sense to continue to operate the mill at a loss," Siebers said. "Unless something improves dramatically and quickly, the mill is expected to close on May 6."

The Pomona plant takes ONP to create new, 100-percent-recycled newsprint.

The Pomona plant had been buying 17,000 to 18,000 metric tons of old newspapers per month. San Bernardino Sun