Government urged to help save Far North mills as closure looms

Northland leaders say there is still a pathway to save Kaitāia’s mill and triboard plant, but Government support may be needed to turn investor interest into viable deals.

The future of the mill remains uncertain and Northland leaders have urged the Government to step in and help save two major Kaitāia timber mills from closure, warning the loss of the operations would have a devastating impact on the Far North economy.

Northland Regional Council, Far North District Council and regional economic development agency Northland NZ are backing efforts to secure investors for Juken New Zealand’s Northland Mill and Triboard plant, which were placed on the market earlier this year.

Japanese-owned Juken New Zealand began consulting earlier this year on the future of its Far North mills, seeking buyers through a process that closed in late May.

With no deal reached, the company now plans to shut the Northland Mill. The proposal on the closure began earlier this month, with a final decision expected on Wednesday.

The Triboard Mill, which employs about 140 people, remains up for sale.

While no outright buyers emerged, Northland NZ said interest remains in both operations, providing a potential pathway to keep the sites running if investment can be secured.

Northland NZ head of investment Tui Rutherford said Government support could help retain jobs, protect Northland’s forestry industry and deliver financial returns over time.

“Conservative modelling predicts that investing right now will generate a good return over five years on an initial Government investment,” Rutherford said.

“Acting soon also avoids economic damage and disruption, which will cost the Government dearly in the long term.”

Northland MP Grant McCallum said while there is “no move from the Government to step in. The Government is monitoring the situation very carefully and still hopeful of a commercial settlement, with the mill being bought by a private enterprise”.

He said the Government was aware of the significance of the mill to the Kaitāia and Far North community.

Japanese-owned Juken New Zealand began consulting earlier this year on the future of its Far North mills. Photo / Yolisa Tswanya

“If someone’s got a proposal they want to take to the Government, they’re more than welcome. I’m not sure what the outcome would be, but people are welcome to make approaches if they like and ultimately, it would be a decision for the Minister of Finance to work through and the Minister of Regional Development. But ultimately, at this stage, there has been no inclination that I’m aware of for Government to get involved.

“But that’s not to say they wouldn’t, but that’s just to say that we are monitoring the situation. Government has got to be very cautious about getting involved in private businesses.”

Northland NZ understands an experienced operator has expressed interest in the Northland Mill site, with plans centred on upgrading equipment and modernising operations to target new markets. Meanwhile, another expression of interest has been received to continue operating the Triboard plant.

Northland Regional Council chairman Pita Tipene said the council was working alongside Far North District Council and Northland NZ to help progress discussions and attract investment.

“This includes working on a consortium of investors to back the commercial upgrade plans for the Northland Mill site. That model would require investment by the Government.”

Far North Mayor Moko Tepania said the site’s future was supported by Northland’s strong forestry resource, experienced workforce and established infrastructure.

“There is a significant opportunity to build on these assets, which are supported by experienced operators and well-established infrastructure,” Tepania said.

Rutherford said early Government investment in both proposals will help secure a successful transition of the milling operations, retain jobs and provide financial return to the Government.

“The regional economic agency is working alongside the councils to ensure potential investors understand the strategic value of the operations within Northland’s wider forestry system, with the robust returns forecast.”

Investors interested in this project can contact Head of Investment at NNZ, Tui Rutherford directly at tui.rutherford@northlandnz.com

Yolisa Tswanya is Deputy News Director at The Northland Age. An experienced journalist and newsroom leader, she holds a bachelor’s degree in journalism and reports on a broad range of issues across the Far North and Northland, with particular interest in health, education and community affairs.