Simplot factory threatened by water price hike

Food processor, Simplot, has been told the annual water bill for its Devonport factory could increase by $2 million, threatening the facility’s future and the jobs of its 300 employees.

According to ABC, Simplot’s chief executive, Terry O’Brien, told Landline he’s been advised the annual water bill at the Davenport factory in Tasmania could rise from $800,000 to $2.8 million.

“I can tell you, you have to sell a lot of green peas to make that two million dollars,” he said.

The company is expected to discuss the viability of its Australian factories with its US owners next week.

In June this year Simplot announced its Devonport and Bathurst facilities are under threat thanks to high costs and the rise in cheap, imported products.

The announcement followed a six month review of Simplot’s supply chain operations in the vegetable category.
Meetings were then scheduled with local, state and federal government representatives, employees, unions, suppliers and growers to discuss profit improvement opportunities.

"If insufficient opportunities are identified, we will be forced to close our Bathurst plant after the next corn season. Our Devonport plant will be required to produce a five year improvement plan with satisfactory outcomes or face the prospect of a longer term (three to five year) closure," O’Brien said in June.

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