Almost 200 employees at Albury's Norske Skog paper mill will lose their jobs after the company announced the sale of its Ettamogah site to Australian papermaker Visy.

Key points: A paper mill that has operated in Albury since 1983, is set to close after Norwegian owners Norske Skog sold the site to Australian company Visy

A paper mill that has operated in Albury since 1983, is set to close after Norwegian owners Norske Skog sold the site to Australian company Visy The 183 staff were informed that production would end at the mill in December

The 183 staff were informed that production would end at the mill in December It is hoped that Visy will redevelop the site in the future, with the potential for new jobs to be created

In a meeting yesterday, the 183 staff members were told production at the mill would end in December.

The company said the sale comes after a review of the Australasian operations by Norske Skog's owner Oceanwood, found the need to reduce newsprint capacity.

Norske Skog's regional president Eric Luck said it was a sad day for many people.

"However, it reflects the structural change in the newsprint industry and the need to address declining domestic sales, lower prices and increased reliance on exports into volatile Asian markets," he said.

Visy has not revealed its plans for the site which has been operating in the region since 1981, but it is hoped the company will redevelop it.

"A positive aspect in today's announcement is Visy's plans to undertake multiple feasibility studies on potential future uses on the site in the shorter and longer term," Mr Luck said.

"This provides the opportunity for future jobs in the region."

The Norske Skog paper mill at Ettamogah, NSW, on May 24, 2018. ( ABC Goulburn Murray: Allison Jess )

Troubling times

The sale comes amid tough times for the industry which Australian Manufacturers Workers Union representative Dave Corben said is a result of several factors.

"Manufacturing is struggling in general and we seem to feel a lot of that through energy costs coming into play, the very high cost of electricity and gas," he said.

Production cost, the world market and decline in the print market are also contributors according to Mr Corben.

"Paper is a very strange thing, Norske Skog makes newsprint paper to make newspapers, that's the Albury site that's all they do — basically less people are reading printed newspaper," he said.

Not unexpected

The union said that the decision has not come as a surprise and that the confirmation of the sale resulted in mixed feeling for staff.

"There is a little bit of relief because there has been a lot of rumours going on around the site and people have been very concerned," Mr Corben said.

"But of course, people have got to face becoming redundant just before Christmas, so that is going to be a bit of a family issue at home, people will be out of work."

According to Mr Corben the union became aware of the potential sale earlier this year and has been working to ensure the best outcome for the staff.

"It has been expected. We've been talking with the company probably for the past few months trying to work out what was going on," he said.

"The company has been really good with us and as soon as they knew and the sale was done, they spoke to us yesterday."

Norske Skog has linked a decline in newspapers to a drop in demand for paper. ( ABC News: Fiona Breen )

Staff support

Norske Skog's Regional President Eric Luck said the company will offer staff continued support in the lead-up the mill's closure, with counselling and outplacement services to be provided.

The sentiment has been echoed by the Australian Manufacturers Union's Dave Corben.

"Our main concerns were to make sure that people were going to get their entitlements under the enterprise agreement and be treated with some respect and dignity on the way out," he said.

"And that seems to be something Norske is onboard with, which is good."

He expects some of the older workforce to use their redundancies to retire early and is hopeful others will be able to find work in the region.

"It's the younger ones that we're concerned about, the ones that are just starting out and have based their life around working at that factory to those conditions and wages and will no longer have that job," he said.

Norske Skog said operations at its other two Australasian plants, in Boyer, Tasmania and one in Tasman, New Zealand, will continue as normal.