Historic East Kilbride plant to close
Scots dairies to shut in Muller’s £15m review
Dairy giant Müller is likely to close its dairies in East Kilbride and Aberdeen with the potential loss of 229 jobs as part of a review that will see it invest £15 million in its Bellshill operations.
Müller Milk & Ingredients says the dairies in Aberdeen and East Kilbride – which was the base for Robert Wiseman Dairies which it acquired for £279m in 2012 – are operating well below capacity. More than 60% of the capacity at the Aberdeen dairy is unused.
It has confirmed a 45-day statutory consultation while it looks at winding down milk processing at both dairies.
Its network of distribution depots in Scotland is not under review, but some roles at Aberdeen depot will also fall under consultation.
In a statement, the company said: “It should be stressed that no decisions will be taken until the consultation period is complete and the business has had the opportunity to review its findings.
“In the event of a decision to wind down processing operations at the Aberdeen dairy, all 43 farmers supplying the site will be offered the opportunity to continue supplying the business, conditional on the acceptance of a 1.75 pence per litre transport charge which reflects the need to move the milk to Bellshill for processing.
“Farmers in the area who don’t wish to continue supplying Müller in the longer term in the event of the closure of Aberdeen dairy will avoid the transport charge and their contracts will terminate on expiry of the 12 months’ notice, giving them time to make alternative arrangements for their milk production.”
The firm believes the three-year investment at Bellshill will improve efficiencies and competitiveness and allow it to broaden the range of products.
East Kilbride was the headquarters for Robert Wiseman Dairies which began as a family farm in 1947. The business was floated on the stock market in 1994 and the founders made an estimated £100m fortune from selling it to the Bavarian company, still best known for its range of yoghurts.
Müller said it is investigating further opportunities to grow its business in Scotland as it seeks to build a diverse dairy business in the UK.
Andrew McInnes, managing director of Müller Milk & Ingredients said: “We aim to reinvigorate our fresh milk and ingredients business in Scotland and propose to invest to make Bellshill a centre of excellence for dairy, benefitting consumers, customers, employees and farmers.
“It is important to stress that the status quo is just not viable in the medium term. Our Scottish dairies are inefficient and costly which is putting a brake on the innovation and investment needed to stimulate new demand for dairy products.
“Our Aberdeen dairy is operating at less than 40% of its capacity and milk production from farmers in the North East is far in excess of customer requirements in the area.
“Our small dairy in East Kilbride makes products including flavoured milks and potted cream and we believe that we can gain important efficiencies by relocating that production to Bellshill, which is nearby.
“We will enter the consultation with an open mind and will rigorously assess the situation and listen to our colleagues before arriving at a decision.”