The operators of DTM Timber's Mundubbera sawmill have given its 18 employees three weeks' notice, with operations to cease on September 24.
The sawmill has attributed the decision to the impacts of COVID-19 restrictions as well as difficulties replacing skilled staff.
Production will shift south to DTM Timber's Tiaro Mill with capacity to be increased to accommodate the change.
Closure a sign of the times
The ABC understands the mill's staff had previously been warned of a potential closure, partly due to poor results, but the impacts of COVID-19 had forced the decision.
All workers have been offered employment at DTM's two other mills at Tiaro and Maryborough and redundancies and other entitlements will also be paid.
The LNP's State Member for Callide, Colin Boyce, said the decision was a harsh reflection of the current economic climate.
"I feel for the people who have lost their jobs. I think we will see more of this in business and industry in general as we feel the continuing economic flow on affects of COVID-19," he said.
"With our current COVID-19 era that's driven them to this commercial decision they've made. That's a blow to the community of Mundubbera but that's a reality of these economic conditions.
"There are people that have worked in that mill for a long time and that will be a blow for them particularly in this COVID-19 era."
