OTTAWA, ON, Jan. 31, 2026 /CNW/ - Today, the Honourable Mélanie Joly, Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions, announced that the Government of Canada is investing $7.5 million through the Strategic Response Fund (SRF) to help Kap Paper Inc. complete a Front End Engineering Design (FEED) study to support a pivot in its operations toward growth markets.

The study will establish the key execution criteria necessary for a final investment decision on creating a new medium-density fibreboard (MDF) facility. This facility would keep Kap Paper operational, safeguard employment in Kapuskasing, Ontario, and strengthen the regional economy.

Quotes

"Kap Paper is a regional economic driver and provides key integrated support to northeastern Ontario's softwood lumber industry. This investment will help the company define its plan to manufacture higher-value products to diversify revenue streams, stabilize demand for fibre and maximize the economic output of harvested timber. For Ontario, developing these products will help create and maintain jobs, and strengthen regional economies."
– The Honourable Mélanie Joly, Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions

Quick facts

• In October 2025, the Federal Economic Development Agency for Northern Ontario (FedNor) announced $10 million to support Kap Paper and protect over 2,000 jobs across northeastern Ontario.
• The Kapuskasing mill directly employs around 240 workers, while supporting up to 2,500 indirect jobs in the regional forestry and logistics sectors.

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