According to the company, the decision was driven by business and operational challenges unique to the Southard operation.

"The decision was driven by several business and operational factors specific to the Southard operation, including the escalating complexity and cost to mine and manufacture the specialized products in the portfolio," said Maureen St. George, senior manager of corporate communications for USG.

The Southard operation has long been a cornerstone of the regional economy, with the gypsum mine and processing plant serving as a major employer for roughly 100 years. Since becoming part of Germany-based Knauf Group in 2019, USG has continued operating the facility while supplying specialized gypsum products.

The announcement prompted an immediate response from state and local officials, who are working to help displaced employees remain in northwest Oklahoma.

State Rep. Mike Dobrinski (R-Okeene), whose district includes many affected workers, called the closure devastating for the region.

"USG has been one of the largest employers in this area for over a century," Dobrinski said. "This is devastating news for these employees, their families and our area as a whole."

Dobrinski said he is coordinating with Rep. Carl Newton (R-Cherokee), Sen. Darcy Jech (R-Kingfisher), local CareerTech centers and state agencies to connect employees with new job opportunities, workforce training and unemployment assistance. CareerTech campuses participating in the response include Chisholm Trail, Northwest, Autry and High Plains Technology Centers.

The Oklahoma Employment Security Commission will also provide assistance through its Oklahoma Works Rapid Response program, offering career counseling, job search assistance, training opportunities, unemployment benefit guidance and other support services for affected workers.

"We are fortunate to have many businesses in diverse industries here in Northwest Oklahoma that are actively expanding their workforce every week," Dobrinski said. "While this news was not expected and certainly disappointing, we will continue doing all we can to ensure other businesses see our area as a valuable place to locate their operations."

Local economic development organizations have also pledged support. The Major County Economic Development Corporation and Northwest Technology Center said they are partnering with chambers of commerce, local governments and workforce agencies to coordinate resources and assist employees during the transition.

USG stated that affected employees will be offered severance packages, career transition resources and relocation opportunities for those interested in transferring to other USG facilities.

"We are grateful to all the employees who have worked for us, and appreciate all of the community partners who have worked with us," St. George said.

The closure marks another significant change for the North American gypsum industry, where manufacturers continue evaluating production portfolios and operational costs while investing in newer facilities and product lines. For northwest Oklahoma, however, the immediate focus remains helping hundreds of workers transition to new careers while preserving the region's skilled manufacturing workforce.

The Southard facility specialized in mining and processing some of the highest-purity natural gypsum deposits in North America, producing industrial and specialty gypsum products rather than conventional wallboard. Its portfolio included gypsum cements used for architectural castings, molds, ceramics and dental applications, high-purity calcium sulfate fillers for food, pharmaceutical and industrial markets, agricultural gypsum for soil conditioning and crop nutrition, and specialty mineral fillers used in cementitious and polymer-based products. The plant's exceptionally pure gypsum reserves made Southard one of USG's key sources for specialty products serving industries well beyond commercial construction.

Other Manufacturing Facilities That Have Closed This Century

While the closure of USG's Southard plant is significant, it is not unprecedented within the gypsum and drywall manufacturing sector. Manufacturers have periodically consolidated production networks in response to changing demand, rising operating costs and modernization efforts. In 2020, CertainTeed announced it would close its gypsum wallboard manufacturing plant in McAdam, New Brunswick, shifting production to other facilities as part of a broader effort to strengthen its North American manufacturing network. 

Georgia-Pacific has also restructured its gypsum operations over the years. During the housing market downturn in 2008-09, the company closed or idled multiple gypsum wallboard plants, including facilities in Long Beach, Calif., Savannah, Ga., and Winnipeg, Manitoba, while suspending production at several other locations to better align capacity with reduced market demand. 

Despite these closures, the gypsum industry has generally shifted toward investment in larger, more efficient manufacturing facilities rather than reducing overall production capacity. CertainTeed recently completed a major expansion of its Palatka, Fla., gypsum wallboard plant, doubling production capacity and creating what the company describes as the world's largest gypsum manufacturing facility. Similar modernization projects across the industry reflect a broader trend of consolidating production into high-capacity, strategically located plants that can serve growing regional markets more efficiently.