The jobs of 19 timber workers have gone in the south-east of South Australia.
The Kalangadoo timber processing plant has closed less than two months after South East Pine bought it from Gunns.
Union official Brad Coates said an assistance package was being made available for the affected workers.
He remained hopeful a buyer would be found for the plant.
"We're buoyant that there is some discussion happening at the moment, however it is a long shot but we're hoping a white knight will maybe step in and put some light on the situation and maybe see a way forward where this site can continue to operate after Christmas and these workers can continue their employment," he said.
Opposition forests spokesman Adrian Pederick said the SA Government needed to boost support for the region and its timber industry.
"Local millers must be supported and the Government must start investing in the region in order to secure jobs now and into the future," he said.