More than 350 jobs are set to go with the closure of a troubled North East paper mill.

International Paper will close its Inverurie mill by the end of March after a three-month consultation process failed to find an alternative future for the mill. Three hundred and seventy one staff will lose their jobs.

The company say they will continue to market the site and work to help staff find new employment.

The mill was bought over by US-based International Paper in 1996 and produced 250,000 tonnes of paper every year.

When it launched the consultation last year, the company said the mill was expensive to run and faced increasing financial pressures due to an oversupplied market for its product in Europe.

Mill manager Chris Melia said: "We are saddened to bring papermaking to an end in Inverurie but ultimately we have acted to match machine capacity worldwide to the paper volumes demanded by our customers.

"Our focus now is on helping our people make the transition into new employment and to continue our efforts, working with government agencies and others, to market the site for future re-industrialisation."

First Minister Alex Salmond, who is the local MSP, said the closure is a "big blow" for the workforce and community.

He said: "Three hundred and seventy one skilled jobs is an enormous number in a community of this size.

"When the decision was first announced last October that there was to be a 90-day consultation period starting in November we were hopeful that another paper maker could be identified to take over production.

"However, despite the best efforts of Scottish Enterprise, that has not proved possible in the prevailing economic recession."

Mr Salmond added that the Government will offer advice and re-training to workers and that he will meet the mill's shop stewards for talks in Inverurie today.