The company, which employs more than 700 people across its sites, said it was unable to confirm how many jobs would be lost.
Castell Howell Foods is the latest food company to reveal plans for redundancies with the ongoing Coronavirus pandemic.
Scunthorpe-based TSC Foods has revealed it is to axe up to 200 jobs as a result of pressures stemming from the outbreak of the novel coronavirus (COVID-19).
Food and distribution company Brakes has also revealed potential job losses in the wake of the Covid-19-related downturn in the hospitality sector
Oliver Kay, has revealed that it is to restructure its operations, moving out of Bolton in the wake of the Covid-19 pandemic.
Castell Howell Foods said it had entered into a period of consultation with its employees with regard to potential job cuts due to the impact of the coronavirus pandemic.
It said that major events had been cancelled, and it is likely that its core customers, such as schools, pubs, restaurants, hotels, cafés and workplace catering, would not open to full capacity for several months.
The company said it had made efforts to increase sales to non-core business customers, including retail/public and other new markets, but its weekly sales were down by 65%. It said it appeared unlikely that trade would recover fully until well into 2021.
The statement said: “As the UK Government’s furlough scheme is due to end in October, we regrettably need to start the consultation process with our staff, so that further financial losses are minimised once Government support ends.
“We are unable to confirm how many jobs could be lost, as this depends on the extent to which our customers are able to resume trading while operating within social distancing rules. Cuts are expected to come from a combination of voluntary and compulsory redundancies and reduced hours.”
Castell Howell managing director Brian Jones added: “This has been a very difficult decision, and it saddens me personally, as I know the concern that this consultation period will cause our employees. We will do our utmost to support them during this period. I sincerely hope that any jobs lost in the short term will eventually be recreated as and when the hospitality sector recovers.
“After more than 30 years of building the business and trading successfully, this was certainly not something I thought we’d ever have to contemplate. I’d like to reassure everyone associated with our company, including our hugely loyal customer base, that taking these protective measures will ensure that Castell Howell can continue to provide the service levels for which we are renowned.”
The Farmers’ Union of Wales (FUW) has responded to the news. FUW Carmarthenshire chairman Phil Jones said: “For the company to now face potential job losses because of covid-19 is heartbreaking to say the least. The wider consequences for the rural economy, suppliers and staff could be drastic if no alternative can be found.
“We are hoping that this will be only a small blip in this company's future and that they can return to normality, increase their business growth as soon as possible and re-employ not just those that may have lost their jobs but many more.
“The consequences for the food service industry have been devastating and sadly Castell Howell have not been exempt.”