Vion Food UK has announced it could be forced to close its loss-making pork processing plant in West Lothian, Scotland, putting nearly 1,700 jobs at risk.
According to the company, the Hall's of Broxburn continued to record unsustainable losses, in spite of significant capital expenditure and major restructuring exercises.
Vion Food UK chairman Peter Barr said that every possible step has been taken to secure the future of the business, but the company is currently losing £79,000 per day at the site, which is unsustainable.
"There is significant over-capacity in the UK meat industry and market conditions are extremely challenging," Barr added.
Vion has initiated a 90-day consultation exercise with its unions and workers. If the consultation exercise does not reveal a viable way forward for the plant, the company will transfer the work from the plant to its other sites in the UK. However, it will cease to supply the majority of products currently handled by this plant.
The plant was purchased by Vion Food in August 2008 when it acquired the troubled Grampian Country Food, which had been in financial difficulties for several years. Hall's of Broxburn employs 1,150 permanent and 595 agency staff, and is the major processing facility for Scottish pork, handling 8,000 pigs each week.
Vion Food UK, a part of the Netherlands-based Vion, currently employs almost 12,000 staff at 40 facilities across the country. It is a major supporter of the UK farming industry, producing and processing beef, lamb, pork and chicken, as well as a range of sausages, cooked meats and other convenience products.