Dive Brief:
- Dairy products manufacturer Ornua Ingredients will close its Pennsylvania plant and lay off 66 workers, according to a March 5 state Worker Adjustment and Retraining Notification post.
- The layoffs began on Feb. 24 and will continue through April 23, the notice stated.
- The facility closing is a result of an “entirely unforeseen” cancelation of a manufacturing agreement with its sole customer at the plant, Jason Delaney, Ornua Ingredient North America’s managing director, said in a statement. Ornua did not disclose who the client was that severed the contract.
Dive Insight:
Ornua made a bespoke cheese product for only one customer at the Slippery Rock site.
“Following the sudden and unexpected decision of the plant’s only customer to change strategic direction, it is no longer viable to produce product at the site,” Delaney said in the statement.
Ornua also manufactures the Kerrygold brand, which includes the second highest selling butter in the U.S., according to the company’s website. Other manufactured products include Dubliner and Pilgrims Choice brands.
With its North American headquarters in Wisconsin, Ornua Ingredients has four manufacturing facilities in the state and one in Byron, Minnesota, according to its website.
The sudden Pennsylvania plant closure is in contrast to the company’s growth in recent years. In February 2021, the dairy products manufacturer expanded capacity of its cheese ingredients production facility in Hilbert, Wisconsin, to meet increased demand for cheese products in North America from major brands.
Also in 2021, Ornua acquired U.S. cheese ingredient maker Whitehall Specialties, re-branding it as Ornua Ingredients North America. Following the acquisition, the company made substantial investments in its U.S. sites, boosting the its cheese production capacity, according to Ornua’s 2022 annual report.
The company is also in the midst of pushing to make Kerrygold Ireland’s first 2 billion euros food brand. In October, Ornua announced a 40 million euro expansion and capacity upgrade at its Kerrygold Park flagship butter production facility in the country.
The expansion will result in 30 new jobs and increase butter production up to 80,000 tons per year, or over 1 million packs per day.