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The Honolulu Advertiser
Posted on: Friday, March 14, 2008

Weyerhaeuser will close box plant in Iwilei

Advertiser Staff

Weyerhaeuser Co. said yesterday it will close its Honolulu box production plant in May, terminating work for about 85 employees and a major supply of corrugated packaging for local businesses.

The 50-year-old facility in Iwilei represents Weyerhaeuser's only operation in Hawai'i, and is being closed to improve financial returns and competitiveness of the giant forestry products firm based in Washington state. The company said the shutdown isn't related to performance issues of workers.

"Weyerhaeuser has enjoyed serving customers for 50 years in Hawai'i, and it is with much regret that we announce the permanent closure of the Honolulu box plant," said Ed Carter, Weyerhaeuser Containerboard, Packaging and Recycling sales vice president, in a press statement.

"We fully understand the significant impact of this decision on our employees, customers, suppliers and the community, and we will work constructively in the weeks ahead to alleviate these impacts as much as possible."

Operations are scheduled to cease May 12.

The company said it will work with customers to help identify alternate supply options and provide job transition support to employees who will receive benefits in accordance with company policy and labor contracts.

After the box plant is closed, Weyerhaeuser plans to remove equipment and list the property for sale, according to company spokesman Anthony Chavez. Weyerhaeuser owns and occupies a 166,000-square-foot warehouse on a 3.6-acre site at the corner of Nimitz Highway and Alakawa Street near Best Buy and Home Depot.

The city for tax assessment purposes values the property at about $14 million.

Weyerhaeuser is one of the world's largest forest products companies but has been hit with challenges from the weakening U.S. housing market.

Last year, the company reported a net profit of $790 million, but $739 million of that was from discontinued operations that primarily involved the sale of its fine paper and wood subsidiary in Canada.

Weyerhaeuser's forest-based products business lost $78 million, while real estate development earned $129 million.

The company last May decided to examine the possible sale or other alternatives to its packaging business.

The Hawai'i operation is one of 74 Weyerhaeuser packaging production facilities.