CHEAPER DAIRY imports have been blamed for the shock announcement of Nestlé Tongala’s closure in northern Victoria.
The announcement the factory would wind down operations by late next year to mid-2021 took the town, once known as the centre for dairying in the region, by surprise with 106 jobs to disappear.
Nestlé said tinned milk production was set to move overseas, the property sold off and eligible employees supported to find new jobs.
General manager Andrew McIver thanked colleagues for their strong contribution to the company and said the closure was in no way a reflection of their efforts.
“People just don’t buy tinned milk like they used to, and cheaper imports have eroded our business further,” Mr McIver said.
“At the same time, the equipment in this factory is old, and the investment we need to make sure it can operate reliably in the future means that the factory is no longer viable.”
In recent years Nestlé has invested to improve the viability of the factory by adding new product ranges. This has included producing Maggi culinary products since 2010, Nestlé Health Science medical nutrition products from 2012 and Milo Ready to Drink since 2017.
“These ranges have supported the factory, but as milk is bulk of what the factory makes, the newer ranges aren’t enough to maintain manufacturing at the site,” Mr McIver said.
Throughout the next 12 to 18 months, all production at the factory will progressively move, mostly to Nestlé factories overseas, with final closure anticipated between late next year and mid-2021.
“We are sad to be losing committed and talented colleagues and I want to thank each person who has worked at the factory for their hard work,” Mr McIver said.
“Today, our primary focus is on ensuring we do what we can to help each person prepare for their next step.”
Campaspe Shire Mayor Adrian Weston said council would play a role in assisting employees to find more work in the area.
"Council is extremely disappointed at this announcement recognising the impact on not only the workforce, but their families, friends and wider community," Cr Weston said.
"The Tongala factory has been a major employer in our shire for many years.”
Following the closure, the site will be vacated and sold. Equipment currently at the site is either owned by Nestlé or leased, and as it will be relocated, will not be part of the sale.
Member for Murray Plains Peter Walsh said it was devastating news for the community.
"It will be an extremely difficult time for workers and their families as they face the reality of the next 18 months," he said.
"The dairy crisis has hit many people in our region hard and the loss of 106 jobs in a town like Tongala will test the resilience of the community."