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The Dunedin-based meat company said it had advised its staff of the proposal to permanently close the site, and had discussed potential transfer options to its other sites in the region as part of the consultation process.
Chief executive Dean Hamilton said the proposed closure was due to a significant decline in processing numbers over the last 10 years and the opportunity to now process the consolidated volume at its nearby Pareora site.
"There has been significant land-use change in Canterbury and Marlborough over the last decade and there are fewer sheep farms in these regions as they have made way for other uses such as dairy and wine," he said.
Higher returns from land-use conversion, and periods of drought in these regions have contributed to this decline in sheep numbers, he said.
While beef processing volumes had risen significantly over this period, the lamb numbers available had steadily decreased.
Fairton was consistently processing over 1 million lambs prior to 2010. Last season, the plant processed under 500,000 lambs.
This year that has continued to decline and we processed just over 325,000 in a six month seasonal operation.
Mr Hamilton said the company expected sheep numbers to consolidate at around current levels.
Support is being offered to the 370 people at Fairton affected by the proposed closure.
Mr Hamilton said there would be 230 available roles at the company's plants in Belfast and Pareora, as well as at Hokitika, and further roles at sites around the country as the new season commences.