Bagcraft to close doors Oct. 22

Novolex official says demand in wake of COVID created need for efficiencies

BY CHUCK VANDENBERG
PCC EDITOR

FORT MADISON - Officials at the Bagcraft Packaging facility in Fort Madison have announced the facility will cease operations and decommission the plant on Oct. 22.

Novolex, which acquired Bagcraft in 2015, released a statement Thursday afternoon saying all 104 positions the plant will be impacted and those employees were notified Thursday.

Novolex Director of Communications Katie Hendrix said demand for products over the last several months during the COVID pandemic is the root of the closure.

"Our product demand has really changed over the last several months," Hendrix said. "Efficiencies we will gain after the drop in demand was necessary."

Hendrix said the company has more than 60 other operations in North America and has positions available for employees at the Fort Madison facility.

She said some employees will be retained after production ceases to shut down the plant, but couldn't elaborate on how the shutdown will proceed, or how long employees will stay on payroll.

The statement released said other support efforts are underway for current employees.

"We have immediate needs at all levels within many of our other Novolex facilities and we will offer relocation to our Ft. Madison employees where there is a fit.

"We are also working to connect our employees with companies in the area and are providing additional support through our outplacement program which will begin immediately."

Hendrix said she didn't have information on what efforts, if any, were made in conjunction with local economic development officials to keep the plant operational.

Lee County Economic Development Group President Dennis Fraise said these situations are always difficult, but the group's efforts now turn to helping the employees. He said the Iowa Workforce Development's Rapid Response team has been activated.

"We have been in touch with Bagcraft and we're working with them. Our goal now is the employees and to take that long-term approach," Fraise said.

"If there is a silver lining in this its that all of our manufacturers are needing good quality people, which Bagcraft employees are. Our thoughts are with those people in this very difficult situation."

Fraise said support systems are in place to provide transition services, including finding new employment, resume workshops, career counseling, training and assistance in filing unemployment benefits.

Fort Madison Mayor Matt Mohrfeld said he hadn't heard the news of the closing when contacted Thursday morning.

"It is tough. You claw so hard to add and it's hard when you lose them," Mohrfeld said.

He said Bagcraft took over for Wolf Packaging, which was a locally started company and that entity will be missed in town. But he, like Fraise, said now there's a 100 good employees out there.

"That's 100 quality people in that workforce. We're gonna do everything we can to work with that transition. Make sure path to reemployment and re-education is smooth."

Updated with comments from Fort Madison Mayor Matt Mohrfeld - 4:14 p.m.