Fonterra plans to move the production from the plant, which operates between three and five months a year, to other sites.
The announcement comes shortly after the opening of four new plants on South Island.
Exploring all options
Mark Leslie, director New Zealand manufacturing, says a decision is expected mid-March.
“This is a difficult process for our people and supporting them is our priority as we work through the details,” Leslie said.
“We will be discussing all options and opportunities available to our staff around their future employment, as well as providing the support they need to make decisions should the closure go ahead.”
Significant savings by closing
Fonterra said that moving production from the South Island community of around 2,000 people to other sites would bring significant cost savings for the business and its 10,500 farmer shareholders.
“The proposal to close the Kaikoura site has not been made lightly and is one intended to help generate cost savings for the benefit of all Fonterra farmer shareholders,” Leslie added.
According to Fonterra’s website, the Kaikoura plant is supplied with 37m liters of milk from local farms each season. The site processes 245,000 litres of milk each day while in operation, and creates 28 tonnes of cheese that is exported to international markets including Japan, the US, Australia, Europe and Brazil.