On the last day of June 2025, a profound silence will descend upon paper machine 6 at the Kinleith Mill, a quiet that will echo far beyond the factory walls and through the heart of Tokoroa, New Zealand, signaling not just the end of a production line but the culmination of a four-decade-long story of industrial decay. This single corporate decision serves as a powerful focal point for a much larger narrative about the systemic decline of the nation’s industrial towns, exposing the intricate and often devastating interplay between global economic pressures, domestic policy failures, and the deep human cost borne by communities built to serve a single purpose. The story of Tokoroa is the story of the mill, their identities indivisibly interwoven since 1953 when New Zealand Forest Products (NZFP) established the town as a home for its workforce. For generations, the Kinleith Mill was more than an employer; it was the town’s economic lifeblood, a source of civic pride, and a guarantor of stable, intergenerational employment that allowed families to flourish. At its zenith in the 1970s, Tokoroa was a thriving hub with a population exceeding 20,000, all sustained by the promise of the mill. Today, with a population hovering around 14,000, the impending loss of another 150 direct jobs—plus countless downstream contractors—casts a long, subdued shadow over the town’s future, severing the foundational relationship that once defined its very existence.
The Symbiotic Bond and its Painful Severance
A Town Forged in Industry
The establishment of Tokoroa was a deliberate act of industrial nation-building, an engineered community where life revolved around the rhythms of the Kinleith Mill. New Zealand Forest Products constructed not just a factory but a complete ecosystem, a company town where the line between employer and community was intentionally blurred. This created a powerful sense of shared purpose and destiny, where one’s neighbor was also one’s coworker and the town’s fortunes rose and fell with the mill’s. This symbiotic relationship fostered a unique culture of loyalty and stability, insulating the community from the economic fluctuations of the outside world. A job at Kinleith was widely considered a job for life, offering a clear and secure pathway for young people to enter skilled trades through robust apprenticeship programs. This promise of cradle-to-grave security was the economic engine that supported a vibrant ecosystem of local businesses, well-funded schools, and essential community services, making Tokoroa a model of industrial prosperity. The mill was the town’s heart, pumping wages and opportunity through its veins, and its presence was felt in every aspect of daily life, from the morning shift change to the local sports teams sponsored by the company. This deep integration meant the mill’s identity and the town’s were one and the same.
This carefully constructed environment provided a social contract that has all but vanished from the modern economic landscape. The intergenerational nature of employment at the mill was a cornerstone of the community’s social fabric. Fathers worked alongside their sons, passing down not just technical skills but a sense of pride and belonging. This continuity created a deep reservoir of institutional knowledge and a workforce deeply committed to the mill’s success. The company, in turn, invested back into the town, understanding that the well-being of its employees was directly linked to its productivity. This reciprocal relationship ensured that Tokoroa thrived for decades, becoming a testament to an era when national industry was seen as a long-term asset to be nurtured, rather than a disposable commodity on a global balance sheet. The apprenticeship programs were particularly vital, serving as a ladder of opportunity that transformed school-leavers into highly skilled tradespeople—boilermakers, electricians, and engineers—who formed the backbone of the mill’s operations and the town’s middle class. The slow erosion and final closure of these pathways represent more than just lost jobs; they signify the end of a promise made to generations of families.
The Final Cut
The announcement by the mill’s current owner, Japanese consortium Oji Fibre Solutions, to shutter its last paper machine is not merely another round of layoffs but the definitive severing of this core bond. For a community that has weathered decades of gradual decline and restructuring, this feels like the final, deepest cut, signaling the end of an entire era of integrated manufacturing at the site. The decision leaves the community grappling with a profound identity crisis and overwhelming economic uncertainty. The Kinleith Mill, once a towering symbol of prosperity and a secure future, is now poised to become a monument to a bygone era, its partial closure a stark and permanent reminder of the town’s profound vulnerability to distant corporate boardrooms and global market forces. This move is not seen by residents as a sudden shock but as the predictable and painful conclusion to a long, slow bleed that began with the economic reforms of the late 20th century. Each previous round of downsizing chipped away at the town’s foundation, but the closure of paper machine 6 removes a pillar that many believed would always stand, forcing the community to confront a future where its primary reason for being has been irrevocably erased.
The tangible economic consequences of this decision are poised to ripple through every corner of Tokoroa. The loss of over 150 direct, high-wage jobs, compounded by the inevitable impact on contractors and supply-chain businesses, will create an economic vacuum that a town of 14,000 will struggle to fill. Local retailers, already facing a challenging environment, are bracing for a sharp decline in spending as household incomes plummet. Larry Sullivan, a local business owner for 40 years, has noted that this is the quietest winter his business has ever seen, a grim forecast of what is to come. This economic contraction threatens not only individual livelihoods but the town’s collective viability, placing immense strain on property values, the local tax base, and the funding for public services. Beyond the balance sheets, however, lies a deeper sense of betrayal. Workers who dedicated their entire careers to the mill, believing in the quality of their work and their contribution to the nation’s economy, now find themselves treated as a disposable liability. The severing of this bond is therefore not just an economic event but a profound social and psychological blow to a community that was built on the promise of loyalty and mutual investment.
The Anatomy of a Shutdown
The Official Corporate Narrative
From the perspective of Oji Fibre Solutions, the decision to close paper machine 6 was a pragmatic and unavoidable business reality. In public statements, CEO John Ryder has pointed to a perfect storm of negative economic factors that made the operation untenable. At the forefront of these issues are the crippling and volatile wholesale electricity costs in New Zealand, which have made running energy-intensive machinery prohibitively expensive. This is compounded by persistent financial losses attributed specifically to the paper machine, which has struggled to remain profitable in a challenging global market for containerboard. Furthermore, the company highlighted the escalating costs required to repair and maintain an aging and technologically complex piece of equipment, arguing that further investment could not be justified. The official narrative frames the closure not as a retreat, but as a strategic pivot. By shutting down the paper mill, Oji intends to simplify the Kinleith site’s operations, allowing it to focus exclusively on the more globally competitive and profitable market pulp sector. This move aligns with a broader corporate strategy to optimize assets and streamline production across its international portfolio.
As part of this global optimization, the company has confirmed that it will now import paper for its packaging operations from its own state-of-the-art plant in Banting, Malaysia. This decision is presented through the cold, rational lens of global logistics and cost efficiency. Operating in a low-cost labor market with more stable energy prices allows the corporation to produce paper at a lower unit cost, thereby improving its overall profit margins. From a purely financial standpoint, shifting production from a high-cost environment like New Zealand to a low-cost one like Malaysia is a logical step for a multinational corporation accountable to its shareholders. The company’s statements emphasize a commitment to the future of the Kinleith site as a pulp producer, positioning the shutdown as a necessary sacrifice to ensure the long-term viability of its remaining operations in the country. This corporate narrative, while factually grounded in market realities, neatly sidesteps the deeper historical context and the profound local consequences of its decision, presenting it as an isolated business calculation rather than the culmination of decades of systemic change and disinvestment.
The View from the Factory Floor
Workers and union representatives offer a starkly different diagnosis, viewing the closure as the foreseeable and inevitable result of decades of managed decline and deliberate disinvestment. Ian Farrell, a union delegate with 30 years of experience at the mill, articulates a widely held belief on the factory floor: this was not a sudden failure, but a slow-motion demolition. He describes a long-term pattern of “trimming,” where essential maintenance staff and skilled tradesmen were gradually reduced, leading to the predictable deterioration of the mill’s infrastructure. According to those on the ground, concerns raised about the aging machinery and failing components were consistently met by management with “educated words that didn’t mean anything substantial.” This perception of neglect has fostered a deep-seated cynicism among the workforce, who believe the company was simply running the machine into the ground until it was no longer economical to repair, thereby creating a convenient pretext for its closure. They argue that a proactive strategy of consistent investment in core production machinery could have preserved its viability for years to come.
Furthermore, there is a pervasive and powerful undercurrent of belief among the staff that unspoken factors played a significant role in the decision-making process. While the official narrative centers on energy costs and market conditions, many workers are convinced that New Zealand’s high domestic wage costs and the enduring presence of a strong union were critical variables in the calculation to shift operations offshore. They see the move to Malaysia as a classic example of capital flight, where a corporation relocates production to a low-cost labor market to maximize profits, leaving a committed and skilled local workforce behind. This sentiment is fueled by a deep pride in the quality of the product they manufactured, which they believe is superior to the paper that will now be imported. For them, the closure is not just an economic loss but an insult to their craftsmanship and dedication. The decision is seen less as a response to an acute crisis and more as the final act in a long-term strategy to de-unionize and reduce labor costs, a narrative that stands in direct opposition to the official corporate line.
The Energy Impasse
A critical factor acknowledged by all sides, yet interpreted differently, is the crippling cost of energy in New Zealand. For the workers at Kinleith, this was a daily, tangible reality. They recount numerous instances where the mill was forced to slow down or halt production entirely because spot market electricity prices soared to unsustainable levels. In these moments, it became cheaper for the company to stop manufacturing its product than it was to pay the power bill, a situation that employees found both frustrating and indicative of a deeply flawed national energy market. This sentiment is echoed at the political level, with figures like Associate Minister Shane Jones publicly decrying the nation’s four major “gentailers”—vertically integrated companies that both generate and retail electricity—as a “cartel.” He argues that these entities prioritize shareholder profits and dividend payouts over providing a secure and affordable energy supply for the country’s vital industrial base, effectively holding large manufacturers like the Kinleith Mill hostage to market volatility. This perspective paints the energy crisis not as a simple market fluctuation but as a structural failure of policy and regulation.
While Oji Fibre Solutions has consistently cited high energy costs as a primary driver for the closure, some analysts argue that this narrative is incomplete. Craig Renney, an economist with the Council of Trade Unions, contends that the company exacerbated its own vulnerability to price shocks by failing to adequately mitigate its risk. He points out that sophisticated financial instruments exist to protect against market volatility, and suggests that Oji did not purchase sufficient energy hedges to shield its operations from the predictable swings in the spot market. This critique introduces the possibility of corporate mismanagement or, perhaps more cynically, a deliberate choice not to invest in long-term risk mitigation for an asset that was already earmarked for closure. This adds another layer of complexity to the issue, suggesting that while the national energy market is undoubtedly challenging for industry, the company’s own strategic decisions may have contributed significantly to the unprofitability of the paper machine. The energy impasse, therefore, is not just a story of high prices, but a case study in the intersection of public policy failure and private sector risk management.
The Long Shadow of Economic Reform
The Unraveling of a National Champion
The present vulnerability of the Kinleith Mill and the town that depends on it cannot be understood without tracing its origins back to the sweeping and radical economic reforms of the 1980s and 1990s. During this period, New Zealand underwent a profound ideological shift, embracing neoliberal policies that prioritized deregulation, privatization, and free-market principles above all else. This “shock therapy” approach fundamentally altered the nation’s industrial landscape and set the stage for the decline of regional manufacturing. The privatization of state-owned assets and the deregulation of key sectors opened the door for foreign ownership on an unprecedented scale, transforming nationally significant industries from long-term community assets into tradable commodities on the global market. Simultaneously, policies like the 1991 Employment Contracts Act were designed to systematically weaken the power of organized labor. The once-mighty unions, which had previously secured landmark wages and working conditions for their members through collective action, found their influence drastically curtailed. This legislative shift tilted the balance of power decisively towards capital, making it far easier for corporations to restructure, downsize, and relocate operations in the pursuit of higher profits, with little regard for the social consequences.
This new economic orthodoxy had a direct and devastating impact on institutions like the Kinleith Mill. The shift from a protected, regulated economy to an open, globalized one exposed domestic industries to intense competition from low-wage countries. For a company like NZFP, which had operated for decades within a framework of national development, the rules of the game had changed entirely. The new environment favored corporations that were lean, agile, and unencumbered by social obligations to their host communities. The weakening of the unions meant that workers had less power to resist cuts to jobs and conditions, while the influx of foreign ownership introduced a new logic of decision-making, one driven by the demands of distant shareholders rather than the needs of local stakeholders. The reforms of this era effectively dismantled the post-war social contract that had underpinned the prosperity of towns like Tokoroa, replacing it with a far harsher reality where communities were left to fend for themselves against the unforgiving tides of the global market. The closure of paper machine 6 is, in many ways, a delayed aftershock of these foundational policy earthquakes.
The Folly of Fragmentation
Veterans of the Kinleith Mill vividly recall a different era, one in which the original owner, NZFP, operated a powerful and self-sufficient vertically integrated model. In those days, the company owned not only the mill but also the vast forests that supplied its raw materials. This structure was a cornerstone of its stability and competitiveness, ensuring a reliable and low-cost supply of logs, insulated from the volatility of external markets. It was a closed-loop system designed for long-term sustainability. However, following a series of acquisitions by entities like Carter Holt Harvey and later the financier Graeme Hart, this integrated model was systematically dismantled. In a process often described as asset stripping, the company’s component parts were sold off to the highest bidder. The most critical of these transactions was the sale of the forests, which largely fell into the hands of overseas ownership. This act of fragmentation was a turning point from which the mill would never fully recover, fundamentally altering its economic structure and crippling its ability to compete.
The consequences of this fragmentation are at the heart of the mill’s current predicament. Having lost control of its own raw material supply, the Kinleith Mill found itself in the absurd and contradictory position of having to purchase logs at fluctuating, and often high, market rates from the very same foreign-owned companies that now controlled the surrounding forests. This introduced a massive new layer of cost and uncertainty into its operations, a handicap that its international competitors did not face. Workers like Ian Farrell find this situation baffling, viewing it as a profound failure of both corporate and national strategy. The loss of vertical integration is consistently identified by those with long experience at the mill as the original sin, the foundational error that set in motion a long-term decline. It transformed a national champion of industry into a vulnerable, dependent entity, forced to compete on a global stage with one hand tied behind its back. This historical shift from a nationally-owned, integrated system to a fragmented, foreign-owned model is a root cause of its current uncompetitiveness and a cautionary tale about the long-term costs of short-term financial engineering.
The Human Toll of Deindustrialization
The Erasure of Skill and Identity
For the hundreds of workers whose careers have been cut short, the loss of their job is far more than a financial blow; it is the erasure of a core part of their identity. Many, like boilermaker Peter Marx, have spent decades honing their craft within the mill’s walls, accumulating a vast reserve of specialized knowledge and experience. His poignant lament of having a “wealth of knowledge I don’t want to die with” speaks to a deep sense of pride and purpose invested in the work. This is not just a job that is being lost, but a vocation, a way of life, and a source of personal and professional dignity. The closure renders their hard-won skills, which were highly valued within the specific context of the mill, suddenly obsolete in the local job market. This forced transition is a deeply disorienting experience, leaving many to grapple with a future where their life’s work is no longer needed. The psychological toll of this erasure—the feeling of being cast aside and devalued—is immeasurable and will linger long after the final paychecks are issued. It represents a profound betrayal of the implicit promise that hard work and loyalty would be rewarded with security.
This personal loss is magnified at a community level by the concurrent decline and effective disappearance of the mill’s once-renowned apprenticeship programs. For generations, these programs were the primary pathway for young people in Tokoroa to move from school into high-skilled, well-paying trades. They were a vital mechanism for intergenerational skill transfer, ensuring that the complex knowledge required to run the mill was passed down and continually refreshed. The end of this system signifies a permanent break in that chain. The pathways that once led to stable, middle-class lives have all but vanished, leaving a profound void in the community’s future and dimming the prospects for the next generation. This is not simply a matter of lost training opportunities; it is the dismantling of the very infrastructure of social mobility that allowed the town to prosper. Without the mill’s apprenticeships, the town loses its ability to cultivate a skilled workforce, accelerating a brain drain as ambitious young people are forced to leave in search of opportunities elsewhere. The erasure of these skills and the pathways to acquire them represents a hollowing out of the community’s human capital.
A Community’s Fading Vitality
The economic fallout from the mill’s downsizing is visibly etched into the commercial heart of Tokoroa. The town center, once a bustling hub of activity, now features a growing number of empty storefronts, standing as silent testaments to the steady decline in local spending power. The impending closure of paper machine 6 is expected to accelerate this trend dramatically. A 40-year veteran retailer in the town has observed that this is the quietest winter his business has ever endured, a direct and immediate consequence of the disappearing high-wage jobs that have long formed the bedrock of the local economy. Each job lost at the mill has a multiplier effect, reducing the income that flows to cafes, shops, mechanics, and other small businesses that depend on the patronage of mill workers and their families. This slow unraveling of the town’s commercial fabric creates a vicious cycle: as businesses close, the town becomes a less attractive place to live, prompting more people to leave, which in turn leads to further business closures. This pattern of decline threatens to transform a once-vibrant community into a ghost of its former self.
This economic decay creates a fertile ground for deeper social problems to take root. Tamatha Paul, a Green MP with deep family ties to Tokoroa, has expressed profound fears that the rising poverty and despair resulting from the job losses could fuel an increase in social ills such as drug use, domestic violence, and crime. She warns that such economic vacuums make struggling communities particularly vulnerable to exploitation by organized criminal gangs, who are quick to capitalize on the lack of legitimate opportunities and the erosion of social cohesion. As formal employment options disappear, the allure of the informal, illicit economy can become a powerful force, particularly for young people facing a future with few prospects. This social breakdown is the second, more insidious wave of deindustrialization’s impact. It erodes not just the economic base of a community but its very social fabric, turning a place of shared pride and purpose into one of anxiety and fragmentation. The fight for Tokoroa’s future is therefore not just about finding new jobs, but about preventing the social decay that often follows in the wake of industrial collapse.
The New Migration
The economic restructuring that swept through New Zealand in the late 20th century spurred a significant urban drift, as Māori and Pasifika families, in particular, left declining regional centers in search of work in larger cities. Observers of the current situation in Tokoroa note that history is now “rhyming,” though with a new, more distant destination. The current generation of displaced workers is being forced to look even further afield, with Australia emerging as the primary beacon of opportunity. Record numbers of New Zealanders are making the trans-Tasman move, driven by the promise of higher wages and more abundant job prospects. For the people of Tokoroa, this is not a choice made lightly. It often means leaving behind elderly parents, lifelong friends, and the deep community ties that have defined their lives. This new migration represents a profound fracturing of families and social networks, a process that is draining the town of its working-age population and its future. Each family that leaves takes with it not just its income, but its contribution to the community’s schools, sports clubs, and cultural life.
This exodus inflicts a deep and lasting wound on the community’s social cohesion. The separation of families across international borders creates significant emotional and logistical strain, weakening the support systems that are crucial in times of hardship. Grandparents are left without the daily presence of their children and grandchildren, while young people grow up disconnected from their cultural heritage and extended family. For a town like Tokoroa, which was built on the strength of its close-knit community, this out-migration is a devastating blow. It accelerates the hollowing out process, leaving behind an aging population and a diminished sense of collective identity. The loss of skilled workers and young families also makes the town less attractive for any potential new investment, creating a self-perpetuating cycle of decline. The new migration is therefore more than just a demographic shift; it is the slow unraveling of the community’s very soul, as the bonds forged over generations are broken by the harsh realities of economic necessity.
Grieving a Way of Life
On the final day of operations for paper machine 6, the raw and complex emotions of the workforce were on full public display. The atmosphere was thick with a mixture of survivor’s guilt for those who would keep their jobs in the pulp section, a deep sense of betrayal by a company they had served for decades, immense pride in the work they had done, and a profound, overarching sadness. At the Focal Point, a local bar that has long served as an unofficial gathering place for mill workers, the camaraderie was palpable as colleagues gathered to share stories, commiserate, and pass around a bucket to collect cash for their laid-off friends. This spontaneous act of solidarity was a testament to the powerful bonds forged in the heat and noise of the factory floor, a final gesture of mutual support in the face of a shared loss. The gathering was less a celebration and more a communal wake, a moment for workers to collectively grieve the end of a significant chapter in their lives and the uncertain future that lay ahead for them and their town.
The emotional depth of this loss was powerfully captured in a farewell speech delivered by Peter Mariu, a long-serving worker. In his address, he connected the closure of the mill to a broader, collective failure to preserve the stories, wisdom, and heritage of their elders. His words elevated the event beyond a simple economic transaction, framing it as a profound cultural and historical loss. The mill was not just a place of employment; it was a repository of shared experiences, a living archive of the community’s history, and a symbol of its identity. Its closure represented the loss of a way of life and the severing of a connection to the past. This perspective reframes the shutdown as a tragedy that extends beyond the loss of income, touching upon the very soul of the community. It is a moment of grieving not just for lost jobs, but for a lost world—a world of industrial pride, community stability, and a clear sense of place and purpose that, for the people of Tokoroa, may never be recovered.
A Nation Adrift Without a Compass
The Absence of a National Strategy
The fate of the Kinleith Mill and Tokoroa is seen by many commentators as a textbook example of New Zealand’s persistent lack of a coherent, long-term national industrial strategy. Economist Craig Renney argues that the country’s approach to economic challenges is overwhelmingly reactive, a practice of “kicking the can down the road” until a crisis becomes unavoidable. When a major employer like the mill announces a closure, the response is typically a short-term package of support for displaced workers rather than a proactive, strategic intervention to prevent the decline in the first place. This stands in stark contrast to the approach taken by other developed nations. Germany’s “Just Transition” model, for example, provides a powerful counterpoint. Faced with the decline of its coal industry, the German government strategically planned and invested for decades to build new, sustainable industries in affected regions, ensuring that workers and communities had a viable future before the old industries were phased out. This required long-term vision, cross-party political commitment, and significant public investment.
New Zealand’s failure to adopt a similar forward-thinking approach has left its regional economies dangerously exposed to the whims of global markets and multinational corporations. The absence of a national strategy means there is no framework for identifying key domestic industries worth protecting, no plan for managing the transition to a low-carbon economy in a way that preserves jobs, and no political will to address foundational issues like energy security and infrastructure investment. Instead, successive governments have largely deferred to market forces, embracing an ideological stance that treats industrial decline as an inevitable and even necessary part of economic evolution. This hands-off approach has allowed the nation’s manufacturing base to be progressively hollowed out, with devastating consequences for towns like Tokoroa. The Kinleith closure is not an isolated incident but a symptom of a much larger national failure to plan for the future, a failure that continues to consign regional New Zealand to a cycle of boom and bust.
The Paradox of a Globalized Supply Chain
The strategic decisions made at Kinleith highlight a glaring paradox at the heart of New Zealand’s modern economy. The country is now faced with the absurd possibility that some of its largest and most iconic exporters, such as the kiwifruit giant Zespri and the dairy cooperative Fonterra, may soon be packaging their world-class products in cardboard made with Malaysian paper. That Malaysian paper, in turn, will likely be produced using pulp that originated from the very same Kinleith Mill. This circular and inefficient supply chain, where a raw material is exported only to be re-imported as a finished product, fundamentally undermines the nation’s economic resilience and outsources a key value-added manufacturing process. It is a stark illustration of how a focus on global efficiency for a single corporation can lead to a nonsensical outcome for the national economy, increasing reliance on fragile international shipping lanes and sacrificing domestic industrial capability for marginal cost savings. This situation exposes the vulnerability of a nation that has become adept at exporting raw commodities but is progressively losing the ability to manufacture essential goods for itself.
The government’s official response to this predicament has only reinforced the perception of a nation adrift. Finance Minister Nicola Willis has unequivocally ruled out any form of taxpayer investment or subsidy to save the paper machine, framing it as an issue for the private sector to resolve. This position is consistent with a long-standing political ideology that favors broad, market-wide economic policies over targeted, industry-specific support. In essence, the government’s stance is to accept the hollowing out of the nation’s manufacturing base as an inevitable, if regrettable, outcome of global market forces. This hands-off doctrine effectively signals that there is no political appetite for developing a robust industrial strategy or for intervening to protect critical domestic supply chains. The consequence of this long-term, systemic neglect became painfully clear. The closure of paper machine 6 was far more than a simple business decision; it was a culminating event born from decades of policy that had prioritized market liberalization over regional security, leaving towns like Tokoroa to bear the full cost of a nation’s strategic vacuum.
