Paulig is intending to cease production at a spices factory in Sweden and move operations to a plant in Estonia amid rising input costs.
The factory in Mölndal, south of Gothenburg, which the business rents, produces spices for Paulig’s Santa Maria brand, which is known for spices, Tex Mex products and BBQ sauces.
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In a statement on Tuesday (27 January), the business said ending operations at the factory in Mölndal would impact all 86 employees at the site, as well as some roles in the company’s Mölndal office. Some 105 staff would be affected in total.
Paulig intends to complete the move by summer 2027. A final decision on the closure will be taken after talks with unions, the business said.
The planned changes would not impact Paulig’s other Swedish operations.
Lenita Ingelin, SVP of the branded business area at Paulig, said: “This change aims to strengthen Paulig’s long-term competitiveness. Rising production costs have put pressure on our profitability, and this change would enable us to handle rising costs more effectively.”
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By GlobalDataThe Finnish group is planning to concentrate spices production in Saue, Estonia, where it has been operating a factory making spices, salsas and sauces since 1993.
The Saue facility employs 84 people and exports more than 80% of its output, Paulig said.
Unlike the rented Mölndal plant, the Saue factory is fully owned by Paulig and, according to the company, has room for expansion. It will be Paulig’s sole spices plant after the end of operations in Mölndal, Ingelin told Just Food.
Paulig’s marketing, sales R&D, and other support functions in Mölndal would continue at the Mölndal and Solna offices following the factory closure.
The company has around 490 employees in Sweden. Alongside the Mölndal facility, it runs a tortilla plant in the country in Landskrona, as well as a warehouse in Kungsbacka.
Paulig generated sales of around €1.2bn ($1.4bn) in 2024.
In July, the company said it will invest €12m to expand production capacity for its Tex-Mex products its Berga plant in Barcelona, Spain. The new line is expected to be operational by the end of 2026 and create up to 30 jobs over the next five to six years.
Paulig has recently expanded through various acquisitions.
In December 2024, the company acquired the Dutch brand Conimex from Unilever to strengthen its Asian food business in the Netherlands.
That deal followed Paulig’s acquisition of UK-based Panesar Foods, the producer of sauces, salsas and condiments, in October 2024.
