Australia’s Bega Group is to close its peanut processing arm, the Peanut Company of Australia (PCA).
The decision will result in a phased shutdown of PCA’s facilities in Kingaroy and Tolga in Queensland, over the next 18 months.
The site in Kingaroy was acquired in 2017 when what was then Bega Cheese bought PCA.
In 2022, Bega Cheese renamed itself the Bega Group to better represent its portfolio, including Bega cheese, peanut butter and Vegemite spreads.
In a statement issued today (9 July), Bega Group said PCA faced “sustained” financial strain for years before its acquisition, with annual losses of A$5–10m ($3.27–6.54m).
Despite “ongoing investments”, Bega Group said it could not “establish a sustainable business model” for the operation.
“Continued financial losses and industry challenges led to the need for the review and ultimately the conclusion that the business would be better served by a change to more local and focused ownership or in the absence of that being achieved, unfortunately a closure,” the statement read.
Bega Group started a strategic review of its peanut processing assets in June 2024.
CEO Pete Findlay said: “We announced the strategic review over 12 months ago and we have pursued several options to sell the business. Unfortunately, we’ve been unable to secure a buyer that could sustain a long-term future for employees and growers.”
The decision puts approximately 150 jobs at risk.
Findlay added: “We understand the impact this decision will have, and we will work closely with growers and the approximately 150 employees at the Kingaroy and Tolga facilities to support them through this period.”
A spokesperson of the company told Just Food the closure affects only PCA’s “raw” peanut processing business, with peanut butter production continuing at Port Melbourne.
PCA, with annual sales of about A$19m, operates additional facilities in Gayndah and Inverlaw.
The Gayndah site, an “overflow site”, was sold separately before this announcement. The future of the Inverlaw site is still being considered, according to the statement.
The spokesperson added: “We are taking this transition very seriously and we will be consulting with local community groups throughout this process.”
In May, the company announced the closure of its cheese processing and packaging facility in Strathmerton in Victoria.
In February 2023, the group announced the closure of its milk manufacturing plant in Canberra, with production relocated to a site in Penrith, New South Wales.
For the first half of its 2025 financial year, Bega Group reported a 3% increase in revenue to A$1.78bn for the period ended 29 December 2024.
EBITDA rose by 27% to A$109.3m. Earnings per share (EPS) grew by 14% year-on-year to 9.9 cents.
