Robert Wiseman Dairies has confirmed it is to close its dairy at Okehampton in Devon.
Production will end during April in line with operational requirements.
Martyn Mulcahy, group operations director at Robert Wiseman Dairies said: “Despite exhaustive efforts by staff, management and Unions to find ways of bringing costs into line with dairies elsewhere in our network, we have been unable to establish an economic basis for continuing to process milk at Okehampton.
“We very much regret the impact that this decision will have on the area and will provide assistance to those who will be affected.”
In the South West, Wiseman has invested more than £100m and created 500 jobs at its dairy and distribution facility at Bridgwater, Somerset. The company also has distribution depots at Pensilva, Bristol, Amesbury and Northampton serving customers in the South, South West and South East.
The processor is also closing its distribution depot at Cupar in Fife.
The decision follows the conclusion of a strategic review and 30 day formal consultation process, prompted by changes in the requirements of customers and the loss of key contracts served by the depot.
Distribution of milk from the site will transfer to depots in Whitburn and Aberdeen during April and the decision could lead to 67 redundancies, the firm has said.