Saputo Dairy Australia (SDA) has announced the retirement of its King Island Dairy brand, after being unable to find a buyer for the 132-year-old brand and its current facility.
The dairy company initially stated it was conducting a review of its Tasmanian King Island Dairy plant in November 2023, to scope out options for its future. Over the past 10 months, SDA has sought to maximise value for the business looking for commercial and financial alternatives for King Island Dairy, including a potential sale to a third party.
With no buyer on the horizon, SDA announced it had made the difficult decision to commence the final operating season of King Island Dairy, with the intention of closing the facility and retiring the brand in mid 2025.
The company stated its immediate focus will be to work with its employees, dairy farmers and the broader King Island community to support them through the transition period.
Saputo Inc. president and CEO (International and Europe), Leanne Cutts, said the decision had not been taken lightly, and closure of the facility was determined to be the most viable way to strengthen SDA’s competitiveness based on changing industry and market conditions, after thoroughly reviewing every possible option.
“As King Island Dairy’s historic roots are deeply embedded in the region, it was hoped the strategic review would identify a potential buyer for the facility. It is a unique brand, with a plant that is nearly 100 years old and designed to produce hand-made specialty cheeses,” said Cutts.
“We have invested more than $40 million in all our Tasmanian operations over the past five years. While our other Tasmanian brands such as Mersey Valley and Tasmanian Heritage are thriving, and King Island Dairy products hold a nostalgic place in the hearts of Australians, the brand has not maintained its position in today’s ultra-competitive food industry.”
Approximately 58 impacted employees have been informed of the decision. Where possible, SDA will identify redeployment opportunities, and where alternative roles are not available, employees will be provided with their full entitlements and outplacement support.
“This decision does not reflect the commitment of our hard-working and dedicated King Island employees and dairy farmers. The King Island community has done everything they can to support us and we will continue to work collaboratively with the Tasmanian Government,” said Cutts.
“SDA remains firmly committed to Australia and will continue to invest in North-West Tasmania, as well as our other operating and supply regions, to deliver on our vision for long-term success here.”
SDA will consult with employees, union representatives, dairy farmers, customers, King Island Council and the Tasmanian Government to discuss the impacts of this decision and ongoing transition support. In the interim, King Island Dairy will continue producing its specialty cheeses as the business develops a closure transition plan.
