Bear Island, Niagara Falls Operations
Montreal, Quebec based Cascades has announced the early closure of corrugated medium manufacturing operations in Niagara Falls in light of notable tonnage increases at Bear Island. According to reports from industry analysts, second-quarter sales in its packaging business were reported to be stable as shipments were steady and benefitting from price increases and lower raw material costs.
Cascades also noted that slightly higher shipments for corrugated products reflected seasonality and softer Q1 levels. Still, overall company results dampened by weaker volumes. CEO Hugues Simon said on an earnings call that Q2 performance was in line with the company’s expectations, as it continues to see “cautiousness” in demand, given trade policy and tariff uncertainty globally.
Bear Island Operations
Cascades’ operation at Bear Island, Virginia, which started up in 2023, is currently profitable, Simon confirmed to analysts. Following issues last year, production levels were up eight percent from Q1 to 82,000 tons. “This trend has continued into July,” when production averaged 1,100 tons per day, reflecting approximately 91 percent of the facility’s targeted ramp-up, the company reported. “We are forecasting a stronger second half of 2025 and are confident that we’ll continue to close the gap.” It’s been mostly running OCC, where pricing has been steady. The site has flexibility to incorporate more mixed paper in the future, Simon said.
Accelerated Niagara Falls Closure
The company announced in July it would close a corrugated medium manufacturing facility in Niagara Falls, New York, as part of packaging business optimization plans, affecting 123 employees. Cascades originally said production would end by September 3. On the most recent earnings call, Simon said that improved momentum at Bear Island contributed to Cascades’ decision to cease production at Niagara Falls early, on August 11. The Niagara Falls closure resulted in a $23 million impairment charge.
Executives acknowledged ongoing economic uncertainty and how that could scramble demand in North America. “We are anticipating third quarter performance to be slightly higher sequentially,” per a Cascades’ press release. “We remain cautious in packaging, where results are expected to be largely stable as benefits from continued favorable pricing and raw material trends are forecasted to be offset by constrained demand levels.”
Cascades now forecasts that 2025 capital expenditures will total $150 million, down from an earlier projection of $175 million. The company is targeting $100 million in annual profitability improvement by the end of 2026.
Founded in 1964, Cascades employs approximately 9,600 women and men across a network of 66 operating facilities, including 17 Recovery and Recycling facilities.
https://boardconvertingnews.com/cascades-provides-updates-on-bear-island-niagara-falls-operations/
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