Breeo Foods, the consumer foods division of Dairygold's Reox Holdings, yesterday announced plans for the closure of its meat manufacturing plant in Mitchelstown, Co Cork with the loss of 70 jobs.
The company will hold discussions with staff and union representatives regarding severance and final closure arrangements for the plant. The process is expected to be completed within months.
The risk of closure has been widely speculated on for some time, particularly since the company announced in January, that all operations in its value chain were under review.
The plant has been the subject of industrial relations difficulties as the company sought to address the high cost base of the operation and recent strike notice was only averted with the assistance of the Labour Relations Commission.
The Breeo Foods Plant in Mitchelstown, formerly called Galtee Meats, has been primarily engaged in the manufacture of pork products including ham, rashers and puddings as well as own label brands for major multiples.
A Breeo spokesman said it was "a very sad day" for everyone connected with the company. "The closure has been forced on the business by events beyond the company's control.
"The consumer foods business in Ireland is operating in an increasingly competitive market with a continually rising cost base. The substantial continued growth of low margin own label products has impacted on the ability of traditional high-cost manufacturers to maintain a competitive edge."
He added that marketplace forces, coupled with a requirement for substantial capital injection in the current facility, which was assessed to be economically non-viable, contributed to the decision on the viability of the factory.
Between 2003 and 2005, Dairygold shed 1,100 jobs in a series of closures and sell-ons and, although chief executive Jerry Henchy said in 2005 that the company had completed most of its rationalisation plan, he warned that costs at Galtee Meats would have to be brought into line.
In recent years, Dairygold has moved towards outsourcing many of its activities, such as the closure of its pig-slaughtering plant in Mitchelstown in 2005 with the loss of 170 jobs and the buying in of pigmeat for processing.
