About 100 workers at Kaitaia's Juken Nissho mill are threatening to strike, following a breakdown in pay talks.
The mill, the town's largest employer, exports specialised board products, mainly to Japan.
The Northern Distribution Union says staff are starting a work-to-rule, along with an overtime ban, and are prepared to move to all-out stoppages if they have to.
The union says that the workers are asking for a 3.5% pay rise over 18 months but that Juken Nissho is offering only half that.