Maple Leaf Foods plans to permanently shut a poultry further-processing plant in southwestern Ontario and flow its work to two other plants with capacity to spare.
The Toronto meat- and food-processing firm said Tuesday it will close its 42,000-square foot plant at Ayr, about 15 km south of Kitchener, in May. Work done at Ayr will be consolidated at two other poultry further-processing plants, on Courtneypark Drive in Mississauga and on Canning Street in Brantford.
"We have an immediate opportunity to increase efficiency and capacity utilization in our value-added poultry business, which this consolidation will achieve," company CEO Michael McCain said in a release.
"Value-added chicken is an important market for us and we plan to grow the business by focusing our operations and investments in our Mississauga and Brantford plants."
The processing work now handled at Ayr includes fully-cooked, partially-cooked and marinated frozen chicken products for the company’s retail and foodservice customers.
Shifting the work to Mississauga and Brantford will involve about $6.5 million in upgrades at those two plants, the company said. The investment at Mississauga will also see about 75 new hourly and salaried positions at that plant.
Closing the Ayr plant, however, will involve a net loss of about 100 positions and about $5.6 million in related restructuring costs, the company said, including severance packages for affected staff.
Maple Leaf said it will work with government and local leaders to find any "alternate, non-competing uses" for the Ayr plant that "leverage the skill base of the workforce and reduce the impact of the closure."
"We deeply regret the impact on our people," McCain said of the Ayr staff. "We will treat them fairly and support them through this transition to secure new employment, either within Maple Leaf or in the broader economy."
The decision to close the Ayr plant comes after Maple Leaf’s announcement last fall of six other prepared-meats plant closures, all to take place by the end of 2014.
Further-processing work handled at those six plants is to move to a new plant at Hamilton and expanded facilities at Brampton, Saskatoon and Winnipeg.
Maple Leaf in October described those closures and consolidations as the final phase of its "value creation plan."
The plan also called for Maple Leaf’s distribution of processed meats to be handled entirely through a new plant to be built somewhere in Ontario and an existing distribution site at Saskatoon. Four other Maple Leaf warehousing plants will be closed over three years.