Potato harvest© Tim Scrivener

The Kent Potato Company (KPC), based at St Nicholas-at-Wade, is to close on 1 December.

The closure is understood to arise following the loss of a retail contract by Greenvale AP, the potato arm of Produce Investments and which owns KPC.

Produce Investments said a period of consultation with KPC employees will close before 23 November, with some being transferred to fill vacancies on its other sites.

See also: Potato supplier Produce Investments buys Jersey Royal Company

Greenvale said it had been working closely with one of its core retail customers to create a supply-chain model more aligned to the prevailing fresh potato market conditions in any given season.

“The outcome of these discussions has resulted in a reduction of its share of the customer’s core fresh potato volume from July 2016,” said the company. While the reduction in volume was disappointing, it said it had secured a three-year supply agreement.

All packing and associated operations from the Kent sites will be transferred to PI’s sites in Cambridgeshire and Scotland.

As recently as late September, Kent Potato Company was celebrating booming business with exclusive potatoes in Lidl, having almost doubled sales of its Amber branded salad potatoes to the retailer.

Greenvale’s potato interests include seed production, growing, processing and packing with supply to the major retailers, wholesale and convenience sectors. The Jersey Royal Company Limited, Rowe Farming and The Kent Potato Company are part of the business, with potatoes accounting for almost 83% of group revenues.

Produce Investment’s revenue was £178.4m in the year to 27 June 2015, down from £191.8m the previous year. Pre-tax profit was £7.3m compared with £10.2m in 2014. It is also a large producer and supplier of daffodil flowers and bulbs.