Home > Simplot to announce fate of Devonport plant this week

Simplot to announce fate of Devonport plant this week

Editorial
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Food processor Simplot is expected to announce if its Tasmanian Devonport plant will remain open later this week.

Should the decision the made to close the plant, it would affect approximately 300 factory employees and 130 farmers that supply produce, The Mercury reports.

In June this year, Simplot announced that two of its plants; Devonport in Tasmania and its Bathurst plant in NSW were under threat of closure due to rising operational costs, the strong Australian dollar and a highly competitive industry.

Since the announcement, the nation’s two Supermarket giants, Coles and Woolworthsboth struck deals with the processor that would see their frozen vegetable private label brands converted to 100 percent Australian grown produce.

Both deals serve as positive news for the vegetable processor however Simplot’s managing director, Terry O’Brien said last week that jobs cuts will still be required in order to reduce costs.

"We don't think buying (frozen vegetables) from us just because we are Australian grown is sustainable for Woolworths -- or any buyer -- in the long term; we want them to want our product because it is financially attractive too," said O'Brien.

"To do that we have to bring down the costs of processing at Devonport; and the only way we can do that will involve new machinery, new processing methods and significantly less labour."

If a decision is made to close the Devonport plant, operations will stop within three to five years.

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