Apr 25, 2006. /Lesprom Network/. Tembec Inc., Canada, announced yesterday that its market pulp mill located in Smooth Rock Falls, Ontario, will be idled indefinitely, effective July 31, 2006. The Smooth Rock Falls mill produces 200,000 tonnes of Northern Bleached Softwood Kraft (NBSK) pulp annually. The idling will affect approximately 230 employees. A number of factors have combined to make this decision necessary. Key among these were the high value of the Canadian dollar and the high manufacturing costs at this site relative to global competition. “The combined effect of these factors created a situation that could not be sustained. While there has been some progress over the past two years relative to reducing the delivered cost of fibre, the overall financial performance of the Smooth Rock Falls mill has been unacceptable,” said Terrence P. Kavanagh, Executive Vice President and Chief Operating Officer. “Decisions of this nature are never easy to make, and Tembec regrets the impact of today’s announcement on employees, their families and the Smooth Rock Falls community,” concluded Mr. Kavanagh. This decision is consistent with the recovery plan that was announced previously by Tembec President and CEO, James Lopez. Margin improvement at all manufacturing locations is central to this plan, and the company had indicated that, where no long term solutions could be identified and implemented to achieve this goal, necessary action would be taken. Tembec is a leading integrated forest products company, with extensive operations in North America and France. With sales of approximately $3.8 billion and some 10,000 employees, it operates 50 market pulp, paper and wood product manufacturing units, and produces silvichemicals from by-products of its pulping process and specialty chemicals. Tembec markets its products worldwide and has sales offices in Canada, the United States, the United Kingdom, Switzerland, China, Korea, Japan, and Chile. The company also manages 40 million acres of forest land.