"This is very unfortunate news for the Circular Head community, which has only recently been buoyed by good news in the dairy sector," Mayor Quilliam said.

"It is extremely frustrating that uninformed commentary has resulted in a reduction of demand for Ta Ann's product, which has led them to this decision."

Mayor Quilliam said the State Government needed to demonstrate leadership to counter the negative campaign being spread about Ta Ann and its Tasmanian practices.

"The truth of the matter is that Ta Ann only sources its timber from an AFS certified resource that is a sustainably managed forest in accordance with long term-contracts," Mayor Quilliam said.

"While the investment in both the AgriTas Trade College and Harcus River Road will provide some relief in the long-term, these workers and their families will need this support now."

"Council agrees with Ta Ann Tasmania and urges Professor West's Independent Verification Group and the Statement of Principles signatories to find a solution that provides for sustainable wood production and conservation to solve this impasse.

"The concerning thing is that other investors in Tasmania would no doubt be reconsidering their position following such a negative campaign."

Mayor Quilliam said the on-flow effect of job losses at the Smithton mill would be felt through the municipality.

"I feel for the workers that have been affected by this decision and am sure we as a community will come together to see them through this time," Mayor Quilliam said.