Sofidel To Invest $200M In Minnesota Manufacturing Expansion

The global tissue paper manufacturer will triple its workforce in Duluth with $5M in support from the state. Plus, Minnesota continued its job growth streak in September.

Tissue paper manufacturer Sofidel will invest $200 million to expand its operations in Duluth, Minnesota. The state of Minnesota is supporting the project with $5 million in business expansion funding. The Italy-based company’s expansion will create at least 160 new jobs, tripling the company’s current workforce at the location.

Sofidel acquired the Duluth paper mill from ST Paper in January 2024. The company will expand the existing facility into an integrated, state-of-the-art production plant where raw materials are processed, manufactured, and packaged into finished goods such as paper towels, bath tissues, and napkins. Sofidel will also build an automated warehouse for product storage and distribution. Construction will take place in phases beginning in late 2024 and continuing through late 2026. The completed project size will be nearly 600,000 square feet.

Sofidel Minnesota
Sofidel Group acquired its Duluth, Minnesota paper mill from ST Paper in January 2024. (Photo: Sofidel)

“This expansion is a testament to our long-term commitment to growth and innovation in the North American market. In Duluth, we found a favorable operating environment, with a skilled and dedicated workforce, and strong partnerships with local institutions and the community. These factors encouraged us to further invest in this facility,” said Simone Giacomelli, Integration Manager at Sofidel. “We are also grateful for the tremendous support from the State of Minnesota and the City of Duluth, which has been essential in bringing this project to life.”

“Minnesota is a top state for innovation in manufacturing for a reason. Our investment in Sofidel is creating jobs and reinforcing Minnesota as a top place to live and work,” commented Governor Tim Walz. “In partnership with our Department of Employment and Economic Development, we are creating high-growth, high-demand, good-paying jobs, and building a stronger economy all across our state.”

The $5 million in business expansion funding comes from the Minnesota Department of Employment and Economic Development’s (DEED) Job Creation Fund (JCF) and Minnesota Investment Fund (MIF). The JCF provides financial incentives to new and expanding businesses that meet certain job creation and capital investment targets. The MIF provides financing to help add new workers and retain high-quality jobs, with a focus on industrial, manufacturing, and technology-related industries.

“This is an incredible investment in Duluth and the entire state – one that reinforces the company’s commitment to excellence in the paper manufacturing industry and northern Minnesota’s economic vitality,” said DEED Commissioner Matt Varilek. “It’s an important demonstration of a public/private partnership – and Sofidel’s presence and efforts will contribute not only to the local and state economies but to the fabric of the community as well.”

“I am incredibly grateful to the teams at Sofidel and DEED, as well as our fantastic City of Duluth staff, all of whom worked tirelessly to ensure the complicated pieces of this major expansion and development fell into place,” remarked Duluth Mayor Roger Reinert. “This is an investment in funding, jobs and to bringing a vibrant life to this manufacturing facility for decades to come. Duluth has a long and proud tradition of making things, especially related to the regional natural resource economy, and we’re thrilled Sofidel sees that and is becoming part of that tradition.”

Minnesota’s Job Growth Streak Continues

Sofidel isn’t alone in creating jobs in Minnesota: Minnesota employers added 6,300 jobs in September, according to DEED data. The state’s unemployment rate increased slightly to 3.4%, but still remained lower than the national rate of 4.1%.

“This was another strong month for Minnesota’s jobs market,” said Varilek. “With ongoing job growth, low unemployment, wages outpacing inflation and high labor force participation, plus surging exports and record business expansions, the Minnesota economy is robust entering the final quarter of the year – even as we partner with the business community, higher education, nonprofits and others to address challenges including the ongoing workforce shortage.”

Four of Minnesota’s 11 supersectors added jobs last month, led by growth in Government (up 3,600 jobs, or 0.8%), Professional & Business Services (up 2,300 jobs, or 0.6%), Education & Health Services (up 1,600 jobs, or 0.3%) and Trade, Transportation and Utilities (up 1,200 jobs, or 0.2%).

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During Manufacturing Month and National Disability Employment Awareness Month in October, DEED is focused on bolstering Minnesota’s manufacturing industry: More than 93,000 job openings are projected for manufacturing production positions through 2032. DEED is also working to increase the number of skilled and work-ready Minnesotans from all communities in the labor force.

Check out all the latest news related to Minnesota economic development, corporate relocation, corporate expansion and site selection.

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