International Paper has decided to shut its Tuskalusa lumber mill in Alabama permanently, with the loss of 172 jobs.

The mill stopped operations four months ago because of continuing economic problems in the industry but company officials had hoped to avoid a permanent closure. The facility had suffered problems sourcing suitable timber and was pressurised from global competitors in Canada, Europe and South America.

Canadian company Tembec has been forced to shut three sawmills for five weeks this summer because of high duties on its softwood lumber exports to the US. More than 490 workers will be affected.