Anderson-Tully Co. is shutting down one of its mills here that has operated for nearly 80 years, sending 55 employees home.

The Mill D closure is blamed on both the expansion of another company facility in Vicksburg and the national economic downturn.

The lumber company will absorb much of Mill D’s operations at its other Vicksburg facility, which recently underwent an $8 million upgrade.

Richard Wilkerson, Anderson-Tully’s executive vice president, said the property on which Mill D now stands will be used for storage of timber off-loaded from barges on the adjacent Yazoo Diversion Canal. He said the logs will be taken by truck to the other plant, called Mill K, for processing.

Wilkerson said the company’s decision to close Mill D is due in large part to an unprecedented slump in demand for wood products related to large decreases in construction of new homes.

“It’s only gotten worse” since the plans to close Mill D were announced in October, he told The Vicksburg Post. “Since 2005, domestic hardwood production is off 50 percent.”

Wilkerson said companies that usually fill their inventories with orders from Anderson-Tully at the end of the year are holding off this December.

Mill D will not reopen, though, even if the economy improves.

“It’s a good plant, but it’s also an old one,” Wilkerson said. “It’s not as efficient as we need it to be.”

He said the improvements at Mill K, which included the implementation of computer technology at every level of lumber production, will increase its capacity by 30 percent.