Meat company Ovation New Zealand is closing its lamb boning plant in Waipukurau with the loss of more than 200 jobs.
Managing director Willem Sandberg says a sharp decline in the number of lamb carcasses available to process means the Hawke's Bay plant is no longer competitive.
He says when it opened in 1985 the national lamb kill was 40 million a year, but now it is less than half that. Operations will be shifted to a more modern plant near Feilding where it will cost less.
The Waipukurau plant is in a seasonal shutdown and will not re-open.
Mr Sandberg says the company will do all it can to help those who will be out of a job, and people prepared to move will be offered work at the company's plants in Feilding and Gisborne.
Central Hawke's Bay mayor Peter Butler says the closure is a major blow for workers and the local business community will also suffer to the tune of up to $7 million a year.
Meatworkers Union area organiser Eric Mischefski says the announcement is sad for workers, but many had seen the closure coming for various reasons including a severe downturn in stock.
The Waipukurau plant opened in 1985 and was initially a joint venture between the former Meat Board and English company Bernard Mathews. It produced lamb roasts for export.