Fazer mulls discontinuation of dairy production at Koria factory

To focus on its core business and the execution of its plant-based strategy, Fazer Foods is considering changes in production at its Koria factory in Finland.

The changes are part of Fazer’s strategy aimed at increasing the company’s share of plant-based products and leveraging the company’s strengths in oats.

The Finnish food company says that if the plans go ahead, the Koria factory will focus solely on producing oat-based drinks and products. This will lead to the discontinuation of Fazer’s dairy operations, which are not part of its core business.

Kati Rajala, VP of Fazer’s non-dairy and dairy business, said: “With our small scale in dairy production, we are uncompetitive and have been challenged even more in the recent inflationary environment. Improving efficiency of our Koria operations is inevitable to secure our competitiveness.”

She added: “A possible discontinuation of the dairy production would enable us to focus on our plant-based core business, in which the Koria factory plays an important role in the future”.

The plans have seen the initiation of change negotiations affecting 226 employees, with the company estimating a termination of up to 95 permanent employment contracts.

“If the dairy business were to be discontinued…vacancies in other Fazer Group units will be offered with priority to those employees whose employment would possibly be terminated. We will also liaise with the local employment administration,” Rajala continued.

“We purchase milk from approximately 20 dairy farmers in Southern and South-East Finland. These farms are very well kept and viable, and we are convinced that many dairies are interested in cooperating with them.”

The possible discontinuation of the dairy business would take place in August 2023.