Biscuit manufacturer Lu Polska, which is part of the French-based Danone Group, is to close down its production plant in Jaroslaw, Poland. The closure will result in the loss of 500 jobs.
The firm claims that the decision is unavoidable because of a reduction in the demand for biscuits in the region.
The Polish News Bulletin reported Alain Locqueneux, Lu Polska's president as saying: "Production consolidation is a result of a difficult situation in the biscuits industry. This is the only solution that will enable us to maintain the competitive position on the market."
However, employers' unions have contested that the plant remains profitable and that the main cause of the closure is bad management.
A merger between the company's Jaroslaw and Plonsk plants has not gone as smoothly as planned.