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Ottawa says it can provide $12M loan to keep northern Ontario paper mill open

  • The federal government said Friday that it will provide a $12 million repayable loan to Kap Paper in Kapuskasing, with Ontario contributing $16.8 million, totaling $28.8 million support.
  • Mounting market pressures, including American tariffs, left Kap Paper in Kapuskasing facing closure as print circulation dropped 12 per cent from 2020 to 2022, Statistics Canada reported.
  • The $12-million federal package comes from two FedNor programs, with a $10 million conditional repayable contribution and a $2 million conditional repayable contribution for planning and development.
  • Phased restart plans will recall employees soon, preserving about 420 direct jobs and supporting 2,500 positions in the regional forestry sector at Kap Paper's Kapuskasing mill.
  • Community leaders welcomed the funding and urged both governments to work together, with Patty Hajdu expecting Kap Paper to meet critical milestones and provide an update before the end of November.
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Kap Paper mill to restart operations after getting more money from province, Ottawa

The federal government says it can provide a $12-million loan to keep a northern Ontario paper mill from closing.

·Canada
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Winnipeg Free Press broke the news in Winnipeg, Canada on Friday, October 17, 2025.
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