By FWi staff

NESTLÉ UK has announced proposals to rationalise its milk and beverage powder operations following the loss of 50% of its export business in the past three years.

These plans will lead to the loss of 207 jobs, 99 of them at the Dumfries factory, which will be closed towards the end of next year.

But a spokeswoman from Nestlé told FWi that the proposals will not effect UK farmers who supply its milk factories.

“This will make our long term commitment to producers secure,” she added.

The company blamed the BSE crisis, which closed a number of important markets and continues to affect sales.

The continuing strength of the Pound, making UK exports expensive, and the economic problems in the far east were also mentioned.

“This is a very difficult announcement to make,” said Rob Murray, managing director of Nestlé Food Division.

“We very much regret the effect that these proposed changes would have on those employees who would loose their jobs.”

Scottish NFU president Jim Walker described the announcement by Nestlé as “yet another blow to the hard-pressed dairy sector.

“The high value of Sterling is not only affecting producer prices, as cheap imports are sucked in to undercut our markets, but is also affecting the competitiveness of all agricultural products.”

Mr Walker urged the Government to reassess the future viability of all manufacturing and export-led industrys for the medium and long term.

He said that the Nestlé decision was yet more evidence which the Union would use to underline its case in a meeting with Bank of Englands Governor Eddie George today (Monday).