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Tip Top's Christchurch icecream factory will close in six months with the loss of about 70 jobs.
The announcement was made in Christchurch yesterday after two weeks of consultation with workers.
Dairy giant Fonterra, which owns Tip Top and its brands, plans to upgrade its Auckland and Perth factories and centralise production.
Tip Top chief executive Ray O'Connor confirmed the decision this morning.
"We regret the closure, but really the changing nature of the markets has been very difficult in the last few years," Mr O'Connor said.
He said the Christchurch icecream plant had been set up "primarily for export".
"The changing nature of the Australian and New Zealand markets require us to restructure for change," he said.
Jobs available in other parts of the Fonterra organisation would be offered to those facing redundancy in Christchurch.
"Where we have other options, other jobs, throughout the organisation, we'll be offering people those," Mr O'Connor said.
"But it will depend, obviously on location and people's circumstances."
When Mr O'Connor foreshadowed the closure in a visit to Christchurch last month, workers were told the plant had been losing about $3 million a year for about the last seven years.
Christchurch would have needed "substantial capital" - more than $13 million over the next five years to maintain the plant - whereas a $40 million upgrade of the Auckland plant over 12 years was near completion.
A review of the Christchurch plant, undertaken last year, had been driven by falling demand from Japan, the second biggest icecream market in the world, but very competitive, Mr O'Connor told staff.
- NZPA
