2 Sisters Food Group has confirmed its Avana Bakeries plant in Newport will close after consultation with staff failed to find ways of keeping the site open.

In February, the UK food group said the factory had lost a contract with Marks and Spencer to competitor Park Cakes ending a 77-year relationship with the UK retailer. The contract represented 85% of the site’s production.

A phased closure has been initiated and is expected to end by summer. The plant employed 650 staff.

“During the consultation, we have fully explored all the options available to us since losing what was the principal customer contract for the site. Sadly, we have been unable to find a way to keep the site viable,” said a spokesperson.

“Our priority now is to minimise the number of compulsory redundancies through seeking volunteers and redeployment elsewhere.”

At the end of last month, 2 Sisters confirmed the closure of its Solway Foods site in Corby, which employs 930 staff.