Silver Fern Farms, New Zealand’s largest meat processor, is to make further cuts to its manufacturing base in the country with the closure of part of its site in Canterbury.
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The company plans to stop sheep and lamb slaughtering at the plant, a move that will lead to the loss of almost 250 jobs.
The announcement comes just a week after Silver Fern said it had agreed to sell its Silverstream sheep boning plant near Mosgiel.
Chief executive Keith Cooper said the closure was the last stage of a project to realign the business and boost efficiency.
Cooper added that a fall in South Island sheep and lamb numbers was crucial to the decision.
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By GlobalDataHe said: “There were also specific issues that make the slaughter processing operation at Canterbury less tenable than other processing options. These include the requirement for significant capital investment in effluent management systems, environmental upgrading, and limited development options compared to other key sites. The proximity to residential zoning also contributed to the decision.”
Silver Fern will now have six full operating sites, with lamb capacity reduced by five chains. Cooper added: “We are taking hard decisions now in regard to the security of our business, ensuring we are an important part of the economic landscape well into the future.”
Earlier this month, Silver Fern gave its support to plans from local agricultural group PGG Wrightson to buy a 50% stake in the business.
The deal requires the approval of 75% of the farmers who supply Silver Fern, which plans to retain a co-operative structure.
The vote is planned for September.
