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  • Paper Related Traffic and Cars

  • Guilford Rail System changed its name to Pan Am Railways in 2006. Discussion relating to the current operations of the Boston & Maine, the Maine Central, and the Springfield Terminal railroads (as well as the Delaware & Hudson while it was under Guilford control until 1988). Official site can be found here: PANAMRAILWAYS.COM.
Guilford Rail System changed its name to Pan Am Railways in 2006. Discussion relating to the current operations of the Boston & Maine, the Maine Central, and the Springfield Terminal railroads (as well as the Delaware & Hudson while it was under Guilford control until 1988). Official site can be found here: PANAMRAILWAYS.COM.

Moderator: MEC407

 #1483451  by CN9634
 
newpylong wrote:Bucksport could have been converted to pulp OR sold to another party, of which there was at least one interested. Instead it was a ramrod sale to a scrapper, that should tell you something. The fact of that matter is the mill was sacrificed so that the New Page merger could continue with less scrutiny.
Doubtful, the cost of doing such would certainly outweigh any of the real benefits of using that existing site (and likely far exceed just starting over at a new, or less complicated site). Timing was right to exit and they did so, likely rightfully so. Not all mills can, or should, be saved. To Roberttosh's point, the West Lynn and Appleton Coated shutdowns out west coupled with those in Maine really drove the other more viable projects to fruition. Some of it was certainly luck too, given that Irving shut off their market pulp to feed their own new tissue assets (rebuild in SJ, expansion in Moncton and new mill in Macon) and now ND has opt'd to export all their pulp to China (not surprising since that was the point of the purchase). Oh and the export pulp is going mostly railcar whereas some of the market pulp was trucking locally. No wonder the Rumford jobs are pushing 6 and 7 days (and the SLRs are being run on their own DJ-1 or other shuttle almost M-F now, at times we have had 6 trains a day here on D1 between Portland and Danville recently).
 #1483462  by gokeefe
 
That's very interesting news regarding Rumford. Thanks for sharing. I agree with newpylong regarding Bucksport. There was clearly viable interest from a serious buyer. Scrapping the mill was very close to being a violation of the Sherman Anti-Trust Act as it appears to have been done solely for the sake of maintaining or attempting to create a monopoly. Probably Section 2 which proscribes anti-competituve acts. Verso was likely saved by the fact that although their market position is dominant it remains subject to competition.

What exactly is the routing of this export product? Rail all the way to Prince Rupert, BC?
 #1483481  by CN9634
 
gokeefe wrote:Scrapping the mill was very close to being a violation of the Sherman Anti-Trust Act as it appears to have been done solely for the sake of maintaining or attempting to create a monopoly. Probably Section 2 which proscribes anti-competituve acts. Verso was likely saved by the fact that although their market position is dominant it remains subject to competition.
I'm sorry are we talking about the same Verso? You realize the shrinking coated paper market has several large international players... ever hear of JD Irving, Sappi or Twin Rivers? Maybe Domtar or Catalyst...? International Paper, G-P, Appleton Coated...the list goes on. Anti-trust doesn't even come close on this.
 #1483533  by KSmitty
 
Shady and Verso go hand in hand...What did it take? 6 days from the time they announced the closing to the date they announced a sale to AIM? Tell me that wasn't all worked out in advance.

That said the reason it never stuck is because the "interested party" never made an actual offer. I know they were in the new stories and such, but saying you're interested, and ponying up the money are 2 different stories. It sucks for the railroad, the employees, and especially the town (who's going to get stuck with a huge bill to complete the demolition after AIM stripped anything valuable from the property and walked away). But at the end of the day it was an inefficient mill in a tough wedge of the paper market. The cost to retool, and then try and compete with an inefficient mill was a greater risk than the reward would justify.
Last edited by MEC407 on Thu Aug 23, 2018 3:02 pm, edited 1 time in total. Reason: unnecessary quoting
 #1483576  by gokeefe
 
Hard to make an offer when no one will even talk to you. Verso wanted that mill shutdown. Had their market position been stronger (70%+) I think they would have been sued by DOJ. It wasn't and then got away with shutting down a mill solely to preserve market position. It was and is legal but they were *very* close to the line.
 #1488651  by gokeefe
 
The things happenning right now are truly jaw dropping. I suspect Madison may be under consideration as well ... I would not rule out "crazy town" possibilities such as brownfield construction of new mills in East Millinocket and potentially Lincoln as well.
 #1488679  by newpylong
 
it shouldnt be jaw dropping that a viable industry that is now right sized is looking strong. But will never see a new paper mill built. If the economics aren't there for shuttered ones...
 #1488684  by Safetee
 
Maines paper industry had a variety of woes; old plants, lousy rail service, inflexible unionized workforce, and a population obsessed with water quality control at a time when there was increased modern foreign competition for dwindling markets.

But when it comes to modernizing paper mills it's not as easy as you would think. I think i can draw a correlation to just renovating older buildings in general. It's very difficult work and when you have to try to keep the old stuff going while the new stuff is coming in, it gets to be very expensive. Making do at critical interface points between old and new to save time or money also limits the benefits of the changes. On the other hand, if you can just build it brand new with nothing old holding you back, you can get tremendous efficiencies in construction and the ultimate operation.
 #1488813  by NRGeep
 
Safetee wrote:Maines paper industry had a variety of woes; old plants, lousy rail service, inflexible unionized workforce, and a population obsessed with water quality control at a time when there was increased modern foreign competition for dwindling markets.

But when it comes to modernizing paper mills it's not as easy as you would think. I think i can draw a correlation to just renovating older buildings in general. It's very difficult work and when you have to try to keep the old stuff going while the new stuff is coming in, it gets to be very expensive. Making do at critical interface points between old and new to save time or money also limits the benefits of the changes. On the other hand, if you can just build it brand new with nothing old holding you back, you can get tremendous efficiencies in construction and the ultimate operation.
No doubt, starting fresh would be optimal, yet the renewed Androscoggin mill is an example of an old plant which benefited from "water quality obsessed" upgrades unlike Baileyville with it's chronic leaks. It can be the difference for sport fishing potential when you have edible v chlorine etc marinated fisheries.

http://www.dartmouth.edu/~cushman/cours ... erMill.pdf" onclick="window.open(this.href);return false;
 #1488841  by CN9634
 
gokeefe wrote:Hard to make an offer when no one will even talk to you. Verso wanted that mill shutdown. Had their market position been stronger (70%+) I think they would have been sued by DOJ. It wasn't and then got away with shutting down a mill solely to preserve market position. It was and is legal but they were *very* close to the line.
So you're telling me that Verso wanted to protect their 'market' position (which is in the low-to-intermediate range on the global scope of things) of the coated groundwood market (mostly second rate these days compared to some of the products out there) to prevent any competitor from coming into a mill that was never built for efficiency (built in 1930s), had a near-death rail branch (key to inbound supply chain and at the end Verso HAD to resort to more expensive outbound trucking because rail service was deteriorating) and doesn't even produce pulp (the real driver behind the current resurgence). I've heard many a disgruntled worker or bystander say that it was an 'inside job' but the real sites of value are what you currently see-- the ones that are turning a profit and still investing.

End of the day is, Bucksport's worth more as anything but a paper mill, and the story was told years ago. Verso is just an easy scape goat... but now everyone has changed their tune since they put money back into Jay (which is a straight line, fully integrated pulp, paper & power plant)... no surprise there, its got pulp assets (which need some work but that's what they are doing).
 #1488858  by gokeefe
 
They had an inquiry from the Justice Department and were forced to divest portions of New Page around the same time. Furthermore they reportedly had several serious buyers, Mahendra being one of them. I get it that they were making a secondary product but their market position was very strong in North America.
 #1488898  by roberttosh
 
Would be interesting to see what the state's total output (in tons) of pulp and paper is now compared to say 1990 when all the mills were still operating at full capacity. I can't imagine the upgrades at places like Sappi have made up for the loss of Bucksport, Madison, the Millinocket mills, etc but it's probably not as bad as one would think and will only improve once Old Town and the upgrades at Rumford and Jay come on line.
 #1488923  by KSmitty
 
I don't remember the exact numbers, but I do remember reading back in the early 2010's that Maine pulp and paper production actually exceeded numbers from 25 years before, despite operating only about 60% as many machines/mills. The newer machines and efficiently laid out mills (basically those remaining today) were that much more efficient that the output was greater even with a significant cut in production lines. These numbers were from the era between Katahdin Paper's closure (the original "renewal" of the original GNP mills) and the closure of Bucksport/Madison/Old Town/Lincoln...So obviously the numbers have changed, but with the exception of Bucksport none of the closures were host to huge production numbers, so you could hazard a guess that even now with the further reduction in production lines/facilities output may very well look about flat over 2 decades ago.