A future in rayon: new life for north shore forestry mills.

• Author: Ross, Ian
• Position: FORESTRY

The forestry industry is rebounding on the north shore of Lake Superior.

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The mothballed Terrace Bay pulp mill has a new owner in the Aditya Birla Group of India.

Birla is a multi-national Fortune 500 corporation with employees in 36 countries.

According to the Times of India, the purchase price was $300 million, but the report did not state whether it was U.S. or Canadian dollars.

With rayon manufacturing operations in India, Indonesia and Thailand, Birla is the world's largest maker of viscose staple fibre. Birla Viscoe is used in a wide variety of applications such as shirts, trousers, diapers, tissues, towels and bed linen.

"It's a transformational move in the forest sector and the first of its kind in Ontario," said Thunder Bay-Superior North MPP Michael Grayelle, the province's natural resources minister

The Birla Group and a Canadian subsidiary, the AV Group, operates two mills in New Brunswick and supplies markets with specialty pulp products to service the textile and paper industry.

The Terrace Bay property was under creditor protection with Ernst & Young as its court-appointed monitor.

The mill was run by the Buchanan Group of Thunder Bay, which purchased the operation from Neenah Paper in 2006. It has a paper grade pulp capacity of 285,000 tonnes.

Terrace Bay has not operated since an explosion last October killed one employee, but plant improvements were made under Ottawa's Green Transformation Program to attract a buyer.

As soon as the purchase agreement was finalized in late June, the company immediately began work in making $250 million in renovations to convert the mill into a pulp-dissolving operation. A new five-year labour agreement was reached with employees.

"The company are the customers because they need it for the production of uniforms and material for clothing," said Grayelle. "This gives us a sense of long-term sustainability for the operation that we haven't seen before."

Under the Birla flag, the operation will provide a minimum of 275 mill jobs, 335 woodland jobs, and offer employment in countless support positions.

Among the many proposals for the property that came forward, Gravelle said the Birla Group made the best case of the mill's long-term viability and operation.

"A large investment by a global company is something that we are excited about as a province."

Gravelle paid credit to his cabinet colleagues, particularly Government Services Minister Harindel-Talchar for helping build...