ISLAND FALLS – National Starch and Chemical Co., a manufacturer of food-grade starch, has laid off 12 people, nearly 20 percent of its hourly work force.

The layoffs, announced July 18, were attributed to continuing slow business conditions, according to William Schafer, plant manager.

“What we need are some orders, just like all other manufacturing,” Schafer said Monday. He added that conditions for doing business in Maine, including high costs for electricity, fuel and transportation, only added to the problem.

National Starch is the largest employer in the town of 790 people and also employs workers from several surrounding towns.

Schafer said the layoffs were permanent and involved people who had worked for the company for one or two years. He said no more layoffs were planned.

He added that the company was looking at several options to increase production and perhaps put some of the people who were laid off back to work.

National Starch is a member of the ICI Group, headquartered in Bridgewater, N.J. Its products range from industrial adhesives to starches.

The Island Falls plant was built in the 1950s by a group of area farmers to make starch from potatoes. Since then, the facility, located on Burleigh Street along the shore of the West Branch of the Mattawamkeag River, has changed hands three times, the latest in 1997 when ICI purchased National Starch for $8 million.

National Starch spokesman Martin Torbert said in a press release that Island Falls layoffs were in line with the company’s past actions of streamlining operations to improve performance and the company’s ability to meet demand and service its customers.

Schafer, who has been the manager at the Island Falls plant since 1998, said that during the last few years, National Starch has made $3.5 million in capital improvements at the plant.