Corporate affairs manager Vince Phillips said that some 300 other people outside the mill including logging contractors would also be affected.

“We are having a couple of weeks annual leave in line with out shipping schedules, “ Mr Phillips said.

“We have a full stock and no room to put any more.”

He said the chip mill had two ships coming in, one in late April and one in early May, and operations then would return to

normal.

Mr Phillips said that chip mill staff had been advised late last year of the possibility of the Easter shutdown and this had been confirmed to employees in February.

“It is a bit unusual for us to be taking leave at this time but 2009 is not a usual year,” he said.

“We are trying to manage it as best we can.”

Mr Phillips said that SEFE hoped to able to maintain “a reasonably normal program” for the rest of the year but there was a possibility that workers may have to take some more leave later in the year.

He said that a lot of other timber mills around Australia were also shutting down for varying

periods.

Construction, Forestry, Mining and Energy Union forestry secretary Craig Smith said that the CFMEU had been in discussions with SEFE concerning a weakened demand for its product from Japan.

“The position they put to us was pretty frightening in terms of the parent company Nippon Paper having to shut down pulp and paper plants in Japan,” he said.

Mr Smith said his understanding was that five or more plants there had significantly reduced production or been mothballed.

This in turn was having a significant effect on raw materials suppliers. “We could not continue to stockpile chips at the site given the downturn in demand for them,” he said.

Mr Smith said that while the union did not like to have to use employees paid leave entitlements in this way it was better than the alternative of redundancies or reduced working weeks.

“We are trying to do as much as we can working with employers to save jobs,” he said, and this was a position supported by the majority of his members.

Mr Smith said that the sawmill at Tumut was also shutdown at present and there were concerns for the future of other forestry product users in NSW.

The union was confident there would eventually be a ramping up

of production in Japan

that would flow on to increased production locally, he said.