Arla is looking to cease production at the Llandyrnog site, while “potential opportunities for the production of other products at this site are explored further” which would result in the loss of 97 jobs.
Its current cheddar cheese production will move to its Taw Valley and Lockerbie creameries. Arla is also proposing the integration of all its cheddar cheese packing lines into its Oswestry packing facility, resulting in the closure of its Malpas and Lockerbie packing operations, and putting 154 jobs at risk across the sites.
The company said it would look to recruit colleagues into vacant positions within its site network and would be setting up links with local job centres, launching career fairs and providing outplacement support as well as working with other local food producers to find suitable vacancies.
The business said it did not anticipate any impact on the supply of Welsh milk.
The proposals come as part of Arla’s three-year transformation programme, Calcium, and the business said it “identified a substantial opportunity to diversify its cheese production as well as improve efficiencies consolidating operations across its production and packing sites, where it currently has capacity which is not currently being fully utilised”.
The dairy producer also announced plans to cut a further 15 head office jobs. It has entered into consultation with those affected. Arla is also reviewing its logistics warehouse network and how it works with third party providers to assess efficiency.
Tomas Pietrangeli, managing director, Arla Foods UK, said: “This proposal enables us to not only drive efficiencies, but also retain ample capacity to better meet the evolving needs of our customers in areas such as retail, foodservice and export. It’s also critical that we retain our approach to innovation and never compromising quality in our cheese business and we feel that these steps are the best to take to ensure our sustainability.
“We recognise that this will be a difficult time for all those colleagues impacted by these proposals and our priority right now is to support them to manage this situation as best we can. We will now be entering full consultation with all our colleagues affected and their trade union or colleague representatives.”
On the head office roles, he said: “We have also entered into a period of consultation with some of our logistics colleagues around work patterns and reward structures and a number of our corporate function colleagues around their potential risk of redundancy. Our ambition is to minimise any potential impact on them. We will be continuously looking at ways in which we can transform our business to ultimately secure the best returns from our farmer owners.”