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Milk moguls to shut down plants in NSW & Victoria

Dairy products company National Foods has announced plans to shut down manufacturing operations at both its Wetherill Park (NSW) and Cobden (VIC) sites.

Dairy Farmers National FoodsNational Foods closure of both the Wetherill Park and Cobden sites come as the dairy company plans to consolidate operations at their existing plants at Baulkham Hills (NSW) and Morwell (Vic). The plan involves a $65.5 million investment in upgrading the Morwell and Baulkham Hills sites, and a phasing out of production and closure of the sites at Wetherill Park and Cobden. There will be 280 redundancies associated with the changes, which will take effect progressively until March 2012.

National Foods’ decision follows an extensive review of the dairy operations of the company following the acquisition of the Dairy Farmers business in November 2008. The review identified that it was not sustainable to have four sites producing fresh and longer-life dairy foods varieties.

Production at the Cobden site, where long-life flavoured milk is manufactured, will be phased out and is scheduled to close in December this year.

National foods will phase out production at its Wetherill Park site, which specialises in yogurt manufacture, and the facility is expected to close in March 2012.

To accommodate the additional volume, National Foods will spend $55 million on upgrading the Morwell yogurt and dairy foods facility in Victoria, and $10.5 million on improvements to the New South Wales Baulkham Hills milk processing site. This will include upgrading existing equipment, installation of new equipment and training.

National Foods Operations Director, Arthur Murphy said any decision to shed jobs is a serious one, but was made to ensure the long term viability of National Foods’ dairy business.

“When we take into consideration the duplication in our manufacturing operations, Fonterra taking back production of its own Ski yogurt currently being made in Wetherill Park, the environmental impacts and costs of running four sites and the reduced demand for products manufactured at Cobden, the review identified that four sites were not viable in the long-term.” Murphy said.

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David Olsen

David Olsen

An undercover economist and a not so undercover geek. Politics, business and psychology nerd and anti-bandwagon jumper. Can be found on Twitter: <a href="http://www.twitter.com/DDsD">David Olsen - DDsD</a>

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