A major restructuring at the Alliance Group's meat processing plant in the Southland town of Mataura is certain to cause job losses but the number of redundancies is not yet known.
The company is moving its sheep meat processing to its Lorneville plant, near Invercargill.
Chief executive Grant Cuff says 260 sheep meet processing staff and 65 staff in management, supervisor, engineer and administration positions will be affected.
Mr Cuff says the changes are being forced on the company because of declining sheep and lamb numbers in Southland, with too much capacity for too few animals.
"There's been a 20% decline in sheep and lamb numbers over the last five years. We have too much sheep processing capacity at Mataura and with no improvement in forecast stock numbers, we're proposing to end the sheep and lamb processing facility at Mataura."
Consultation between unions and staff will now begin, with the changes taking effect in November.
All of the 260 meat processing staff will be offered new jobs at Lorneville, but many of the management positions are expected to go.
The beef processing facility will remain at Mataura, which currently employs 750 people.
