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July 8, 2020

Australian food group Bega Cheese to cut jobs

Australia's Bega Cheese is consolidating processed cheese production and plans to eliminate scores of jobs.

By Dean Best

Bega Cheese plans to cut jobs at a processed cheese facility in the state of New South Wales as part of a consolidation exercise.

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  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
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Sydney-listed Bega, a dairy products and spreads manufacturer, is switching processed cheese production from the Ridge Street site in the town of Bega to its Strathmerton plant in the state of Victoria, with 74 employees set to be made redundant by the year-end.

ABC News reported Bega Cheese’s executive chairman Barry Irvin as saying demand for processed cheeses is in decline as consumers now prefer the natural variety, and is hence moving to strategically rationalise production.

“We’ve elected to consolidate just the processed cheese into the Strathmerton facility because it has been purpose-built,” Irvin told the publication, adding the job cuts represent about 12% of the 600 workforce employed at the Bega-based site. “Anyone who goes to the supermarket these days will see that consumers are buying natural cheese slices not processed cheese slices … it’s a shrinking market.”

Bega Cheese, which also manufactures dressings and snacks, and owns the Vegemite brand, hopes the affected employees will take up voluntary redundancy.

A spokesperson for Bega Cheese, told just-food with respect to the the future of the site in Bega, which is situated in the Bega Valley region of New South Wales: “Bega Cheese has reviewed its processed cheese capacity at Ridge Street in Bega and Strathmerton in Victoria and made the decision to consolidate some processed cheese capacity. The transition of the volume will result in 74 positions being made redundant at our Ridge Street facility by December.

“Voluntary site wide redundancies will be offered, meaning that some processed cheese staff may elect to take the redundancy and there maybe opportunities for processed cheese staff to retrain for other roles within Bega Cheese. Bega Cheese will continue to employ in excess of 600 staff at Bega based facilities.”

More than a year ago, Bega Cheese permanently closed a cheddar and mozzarella production facility in Coburg, a Melbourne suburb in the state of Victoria, following a review of its manufacturing network. 

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Free Report
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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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