The closure of the Whakatāne Mill will have significant onflow effects, according to the district's Mayor.
Judy Turner said its closure is "pretty big for us", and it could be just the beginning of a much larger problem.
"The overseas owners [of the mill] can now get the logs, the products they need closer to home… China plans to be self-sufficient on that matter in 20 years if not sooner," she told The AM Show.
The mill's management said the decision to close came after they lost their largest customer.
"Our internal customer, our parent company, they have decided to transfer the volume, our volume to another supplier and that's the ultimate reason why we have to consider closing," general manager Juha Verajankorva said on Wednesday.
Turner says her first concern is supporting those who need it.
"This is our biggest private employer in the district - it's intergenerationally employed people, it's been going for 80 years."
It's not just the 200 or so direct employees who will lose their jobs - a range of contractors could also be out in the cold.
"The onflow effects will be considerable so our immediate response is to get around our people who are directly impacted and support them."
Local MP Kiri Allan is planning on meeting with mill management and workers in the coming days.
"The discussions will be focussed on can that company pivot to something else that will become economically viable and be able to create a sustainable way forward in terms of jobs and employment for those in the region," she said.