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IP, Rayonier plants in Georgia gearing back up after Irma disruption

International Paper’s local mills are back in business after shutting down operations Sept. 8 in anticipation of Hurricane Irma’s arrival.

IP’s containerboard mill in Savannah and its Port Wentworth fluff mill were shut down Sept. 8 in compliance with evacuation orders for Chatham county. Company spokesman Ryan Thomas confirmed Tuesday that both facilities are now operational.

The Savannah mill produces linerboard — unbleached kraft paper used to make boxes. The linerboard is then shipped to box plants located closer to the customers. The Port Wentworth plant produces fluff pulp for absorbent hygiene products such as baby diapers, feminine care and adult incontinence products.

IP also took a costly hit from Hurricane Harvey at its Orange County, Texas, paper mill.

Speaking Sept. 13 at Credit Suisse’s 30th annual Basic Materials Conference in New York, Glenn Landau, IP’s senior vice president and CFO, said the two hurricanes combined are expected to cost the company more than $35 million, an item that will be reflected in IP’s third quarter operating earnings.

“In terms of impacts for the third quarter, we estimate roughly a $50 million unfavorable headwind to operations largely due to these hurricanes,” Landau said, adding that a scheduled shutdown at the Orange County, Texas mill, originally set to begin later this month, has been moved to next year and will mitigate that loss by some $13 million.

Meanwhile, the Rayonier Advanced Materials plant in Jesup, which also shut down Sept. 8, is back up and running at full production capacity.

The pre-emptive shutdown was managed safely with no injuries and limited physical damage to the facilities, according to Rayonier spokesman Ryan Houck.

Rayonier is expecting a $6 million impact to net income as a result of the production interruption and costs to restart operations, the company said in a statement released Tuesday. Another $1 million impact to net income will come from reduced sales volumes as a result of shipment delays.

Rayonier’s Jesup facility is the largest cellulose specialties plant in the world. Home to two fiber lines producing both hardwood and softwood high-purity cellulose specialties, the Jesup plant manufactures approximately 330,000 metric tons each year.

With a workforce of around 850, the Jesup plant contributes approximately $1 billion in annual economic impact to the region.

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