Plant Closure Inevitable when Tobacco Firms Left Canada: Shorewood Boss

Source from:  recorder.ca By Ronald Zajac, Staff Writer 03/20/2008

The fate of Brockville's Shorewood Packaging plant was sealed when tobacco companies moved their production out of Canada and the United States, the company's president said Tuesday. The Brockville plant's three largest customers, cigarette companies representing 85 per cent of its production, recently moved their production abroad, to Mexico, Europe and South Korea, Shorewood Packaging Corporation president Michael Balduino told The Recorder and Times shortly after employees learned the California Avenue facility will close by year's end. While he would not disclose the names of those large customers, Balduino said one of them is Canadian. Some 270 people work at the Brockville facility and will lose their jobs in "two or three increments" between now and the end of the year, said Balduino, who also confirmed there will be no layoffs at the company's smaller Smiths Falls plant. Although pressures caused by the high Canadian dollar played a part in Shorewood's decision, the movement of the cigarette production to foreign markets was "really the driver" of the closure, he said. "We make packaging for customers who make products. If they want to make products somewhere else, it's very difficult to justify" keeping the Canadian plant open, said Balduino. The company "explored every conceivable option" to avert closure, including selling the plant, pursuing types of production the company does not now do or finding "creative arrangements" with customers, but none of them proved feasible, said the president. "At the end of the day, it just got to be too much of a challenge. The economics didn't work." At the same time, Balduino had nothing but praise for the local employees. "This has been, traditionally, a terrific plant with good people who have done an outstanding job," he said. "We feel very badly for what the impact will be for them and their families." Enditem