German dairy giant Meggle has announced it will phase out production in Osijek by the end of the year.
The Meggle Group said on Thursday it was streamlining its operations with the aim of setting up business models that are viable in all markets in the long term. The decision to shut down production at a plant in Osijek was part of restructuring the group’s operations in Croatia.
Meggle is laying off 160 workers at the Osijek plant. The news has also caused concern among the 300 small dairy farmers that sell raw milk to the processing plant.
Agriculture Minister Marija Vučković has tried to quell some of the concerns the news has raised in Osijek-Baranja County.
“We have already organized talks with dairy industry representatives and relevant stakeholders. I want to make clear, the purchase of milk from 340 small producers, farmers in Osijek-Baranja County, will continue. This accounts for 25 million tons or 6% of the total amount of milk Croatia produces. The buying will continue. If there is a need for more support, given that we have negotiated some additional funding, it will not be difficult to get it for these producers,” Vučković said on Friday.
The company said that over the past 15 years it has invested over HRK 130 million in production and operations in Croatia.
According to the company's website, Meggle Croatia is the third-largest dairy company in the country with 185 employees.
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