Global pandemic sparks high demand for paper produced at northern Manitoba mill.

 Nearly five years ago, the kraft paper mill in The Pas, Manitoba was about to be shut down. But today, it is running in high gear, making and delivering paper for packaging to customers all over the world.  Indeed, the product is in high demand during the global pandemic.

In August 2016, It’s owner, Tolko Industries, announced it was closing its kraft paper mill in The Pas, a town in Northern Manitoba with a population of 5,513. As a result of the shut down, 332 mill workers would be instantly unemployed, along with hundreds more loggers, truckers, and service industry workers that depended on the town’s largest employer. 

Leonard M. Levie, the founder and chairman of American Industrial Acquisition Corporation, led the exploration, negotiation and purchase of Tolko's paper mill after it announced its intention to shut down it in 2016.Canadian Kraft Paper Industries was born.  He stated, “This was among the most challenging acquisitions and turnaround executions we have ever attempted worldwide.  It was an excruciatingly complex, heated, multilateral negotiation with corporate, union and non-union labor, town, provincial, federal, and First Nations stakeholders, each wielding an effective veto over the salvation of the plant. It was an apt test of AIAC’s analytic and negotiating skills.”He added, “The post-acquisition turnaround management was similarly tough, involving a retooling of the management team and business plan.”Within a year of acquisition, the mill was fully turned around, producing record profits in 2018 and 2019.  Then Covid hit. 

The company’s leadership, in cooperation with the union and non-union workforce, and the town of The Pas, decided to keep the business safely running throughout the COVID-19 pandemic.  The pandemic hit the entire province of Manitoba hard.  Nevertheless, the mill rapidly instituted new, rigorous safety protocols and practices and continued to produce northern Manitoba products around the clock, seven days a week. 

Kraft paper manufactured at the Canadian Kraft Paper mill is used to manufacture bags for commodities such as sugar, flour, pet food, and cement.  It is also used for the packaging used for deliveries arriving on doorsteps around the world as online shopping has become increasingly popular, especially during the pandemic. Quarantines, social distancing and isolation also led to a rapid rise in pet ownership, which stimulated pet food sales, anda spike in the demand for pet food packaging. On top of that, a migration of plastic to paper packaging, due to environmental concerns surrounding plastic, further boosted sales of Canadian Kraft’s product.

Trees that are used to produce Kraft paper only grow in northern Manitoba. Slow-growing trees mature over a long period of time, making the tree fibers among the strongest on earth.

Fiber strength is much higher than that of the fiber produced from trees in the southern U.S. In fact, only a few places in North America and Europe produce unbleached Kraft paper like what the mill in the Pas produces.

Leonard M. Levie stated “It has often been said ‘success has many fathers, yet failure is an orphan.’ In our case, success has been the direct result of the shared vision, sacrifice, dedication and passion of the Canadian Kraft Paper Industries family, the great people of The Pas and the Northern Manitoba region, and First Nations. We are a great team.”