However, the company is not saying how many jobs will be lost and what will happen to the production area.
Moira Shire mayor Libro Mustica said it was disappointing that Saputo was moving to an alternative arrangement, but was confident affected employees would find other jobs.
“Murray Goulburn Saputo has been one of our major employers for years and years, it’s heartbreaking, we don’t want anyone to move away from Moira Shire,“ he said.
“Personally I think those people will move on to many other jobs that are available ... especially since there’s a shortage of labour in regional Victoria.”
“I don’t think they’ll have any problems getting another job ... but I really feel for them and I hope they move to another position that’s very successful and what they’re looking for.”
A statement from Saputo distributed on Wednesday, February 9 said the company was “streamlining” its operations at Cobram and Maffra.
“We have made the difficult decision to close one of the two dryers at our Maffra site from 1 March and are seeking expressions of interest for 18 voluntary redundancies,” the statement read.
“At Cobram, our individual wrapped slices production area will close in June 2022, with this work moving to an alternative manufacturing arrangement.”
“We are exploring redeployment opportunities for the limited number of employees impacted.”
The company said management was working with affected employees to “discuss the range of options and support available to them”.
Dairy processors have been struggling with a declining milk pool in recent years.
National milk production has slowed as farmers responded to depressed prices but an improvement in farm gate prices this year has assisted milk production levels to stabilise.
Last year, Dairy Australia’s initial forecasts suggested a zero to two per cent increase this financial year, which would equate to a national milk pool of 8.8 to nine billion litres.
For this financial year, national milk production is down by about two per cent compared to the previous year, and for Victoria, 2.6 per cent.
Northern Victorian milk production, so far this financial year, is down slightly compared to last year, but December has shown a slight improvement, according to figures compiled by Dairy Australia.
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