Saputo to shut Maffra factory, staff losses

The mayor representing the Maffra community has given Saputo a slap over the way it announced the closure of its factory.

Wellington Shire mayor Ian Bye has condemned the timing of Saputo’s announced closure of its Maffra factory.

The Canadian dairy giant will close its Maffra processing plant early next year and downsize its Leongatha and Mount Gambier region operations.

Cr Bye said the shire was not forewarned of the closure, which he said would be a significant blow to Maffra and surrounding communities.

“Today’s announcement is disappointing in that there has been no discussion with the community or the council to leverage other opportunities or consider responsible transition for local employees,” the Wellington Shire mayor said.

“If you ask anyone in Maffra, they’ll tell you how important Saputo was for the region.

“It has been an integral part of the community for decades, and it’s now time for us to look at transition options for the future.”

Flashback: Maffra Butter Factory workers in 1959.

Wellington Shire representatives have been in contact with Saputo management today, following this morning’s announcement.

“As a council we are confident that with a number of different sectors looking for workers, we can start a conversation with Saputo and work towards a solution to benefit everyone involved,” Cr Bye said.

EARLIER

Saputo will permanently close its Maffra factory and cut back operations at its Leongatha and Mil-Lel factories, with the future of 75 employees up in the air.

Management at the Montreal-based processor issued a statement confirming the imminent Maffra closure, ending a century of dairy processing in the Gippsland town.

Saputo will also shut down its bulk powders production site in Leongatha and close its cheese packaging area at Mil-Lel, near Mount Gambier.

Lino Saputo Jr at the 2018 Australian Dairy Conference.

In a statement, management said “many of the impacted production and packaging functions at these three facilities will be absorbed or integrated into the company’s other facilities”.

Saputo president Leanne Cutts said today’s announced changes would take effect in the first three months of 2023.

“While a very difficult decision to make, today’s announcement continues our journey towards long-term success for our business in Australia,” she said.

“(This decision is about) increasing our efficiency and productivity, and making our business more competitive.

“These strategic steps taken to further streamline our network aim to leverage Saputo’s broader manufacturing network capabilities while creating synergies to maximise the return on every litre of milk.”

Former United Dairyfarmers of Victoria president Paul Mumford said the closure was the inevitable result of a shrinking milk pool.

“This is a symptom of conditions over the past few years, with a shrinking dairy industry in Australia,” the Won Wron dairy farmer said.

Maffra locals said the closure had been on the cards.

Local trucking business owner Barry Bedggood said the closure “had been in the wind for a while.

“It’s been scaling down for the past few years,” he said. “But the closure will have a big impact on the community, because it provided a lot of jobs.”

Mr Bedggood said a shortage of workers locally should help offset the impact of the closure, especially in vegetable industry, which had expanded in the region over the last few years.

Maffra’s role in statewide dairy processing dates back more than a century.

The Maffra Co-operative Milk Products Company was formed in 1918 and Swiss-Anglo giant Nestle also began processing in the district in the early 1920s.

Saputo’s Maffra site was previously operated by Murray Goulburn. Back in 1997, MG chairman Frank Stewart and MG field services manager Andrew Gallagher promoted the co-operative

Today’s announcement had been foreshadowed by comments made by Saputo boss Lino Saputo junior in September.

In an interview at a Toronto conference, he said Australia’s shrinking milk pool had forced the company to reassess its operations.

“Australia’s very different from the US – not a commodity issue – more a lack of milk production in the country issue,” he told the Scotiabank conference.