International Paper, one of the world’s largest paper manufacturers, plans to shut down all operations in Savannah, Georgia, and eliminate 1,100 jobs as part of a sweeping effort to streamline its packaging business during a period of economic uncertainty.
The company said it will close its containerboard mill and packaging facility in Savannah and its containerboard, timber and lumber mills in Riceboro, Georgia, next month. The two facilities in Riceboro, located about 40 miles south of Savannah, are expected to close by Sept. 12 and the company plans to record about $247 million in charges for the closings, International Paper said.
At the same time, the company is investing $250 million to convert an existing facility in Selma, Alabama, to produce containerboard, according to a statement from International Paper. The moves are part of International Paper's plan to reduce complexity and costs and to align its resources with the company's most strategic customers, according to a regulatory filing.
Also on Thursday, International Paper announced that it agreed to sell its global cellulose fibers business for $1.5 billion to private equity firm American Industrial Partners, as part of International Paper's "strategy to focus on sustainable packaging solutions,” according to the statement.
Companies in the paper and packaging industry have been making significant moves to refine strategic goals as they deal with economic uncertainty partly caused by tariffs and inflation. International Paper, for example, already announced in early July that it will shut down two manufacturing facilities in Edinburg, Texas, at 1501 N. Closner Blvd. and 715 W. Chapin St.
“While difficult, these decisions are essential to positioning International Paper for long-term success, enabling us to focus on the geographies, customers, and products where we can create the most value,” Tom Hamic, president of International Paper’s North America packaging solutions business, said in the statement about the Georgia plant closings. The company also has operations in Canada.
Shifting trade policies spur industry changes
International Paper acquires wood fiber from sources worldwide, primarily from privately owned forests, according to the company. IP sells its paper and pulp products to customers around the world. But tariffs have disrupted global trade flows, impacting IP as its existing customers outside the U.S. are seeking new sources of paper and pulp products because of shifting trade policies.
International Paper’s Savannah packaging mill opened in 1935 as the Union Bag and Paper Mill and, throughout its history, the mill has been one of the largest employers in Savannah, according to the New Georgia Encyclopedia. The mill was acquired by International Paper in 1999.
The Savannah operations are expected to close in stages with the final closure scheduled for Sept. 30, International Paper said in a regulatory filing. International Paper expects to record charges of about $481 million as a result of the Savannah closing to write off the value of assets and to cover the costs of depreciation, severance and shutdown expenses.
Meanwhile, the conversion of International Paper's mill in Selma is expected to be completed by the third quarter of 2026.
Greif, a Delaware, Ohio-based company shifting its focus to polymer-based packaging products and other business lines, last month agreed to sell its timber land management business, including forestland in the Southeast, for $462 million, to Molpus Woodlands Group. Greif also earlier this year agreed to sell its containerboard business for $1.8 billion to Packaging Corp. of America. Greif has also closed manufacturing operations in California, Georgia and Massachusetts.
Novolex, based in Charlotte, North Carolina, said this month that it’s closing a former Pactiv Evergreen packaging plant in Bakersfield, California, after acquiring the company. Smurfit Westrock, which makes paper-based packaging solutions, plans to close its corrugated container plant in Cedar Rapids, Iowa, in October.
Smurfit Westrock's closure is part of its ongoing optimization efforts and is expected to affect 100 workers, the company told Iowa in a letter.