The proposed closure of the Tauranga site of a national seafood company that could leave 65 jobs on the line would be a "devastating blow" for the industry, economy, and wider community.
Sanford Ltd is proposing to close its site on Cross Rd due to key issues including less fish caught by other companies to process as a result of Covid-19 and not being able to meet new seismic strength requirements.
The company's chief operating officer was "sorry" it had come to this but feared even if processing returned to pre-Covid levels, issues with the building and surrounding area meant it was not viable to continue work.
The site employs 77 people and the company is working with affected staff to try to minimise the number of people impacted.
In May, three people lost their jobs when the Sanford Tauranga Fish Shop closed indefinitely after a building report revealed the shop building was leaky and inoperable.
Tauranga Marine Precinct Advisory Group member and Pacific7 owner Sean Kelly said the closure would be a "serious blow" to lots of support businesses in Tauranga, including his own.
Pacific7 provides workboat and marine engineering services to several local businesses including Sanford.
"Obviously it's also a devastating blow to Sandford's staff and their families."
Kelly said the closure would be a significant loss to the industry and the local economy.
E tū union regional organiser Raymond Wheeler said six of the 77 Tauranga workers were in the union.
He and another union delegate yesterday met with staff and company officials to support them through the consultation process.
Chief people officer Karen Duffy said, "The main issue with the site is the seismic and liquefaction risk."
The site lease is up for renewal in 2026 which Duffy said was a minor consideration.
If the decision was made to close, the company would not resume processing in Tauranga, and the last day of the proposal is August 21, she said.
Duffy said work at the site had stopped to allow staff time to consider their feedback as part of the consultation.
Sanford would enter into a process to try to help affected staff find alternative work within the company, she said.
"We have wonderful staff here in Tauranga, many of whom have been with us for many years."
Chief operating officer Clement Chia said even if processing volumes eventually returned to pre-Covid levels, the seismic issues with the buildings and surrounding area meant it was not viable to continue at the Tauranga site.
"We are very sorry to have to take this path."
Chia said the company had installed a second processing line at the end of last year and were planning for a strong future in Tauranga.
But the combination of the fish processing arrangements hit by the pandemic and the results of seismic engineering reports showed the site was not viable in the long term.
"We would have needed to rebuild or move out within the next few years. The pandemic has unfortunately shortened that timeline."
Ministry of Social Development regional commissioner Mike Bryant said Sanford Ltd applied for the wage subsidy for 75 staff and was paid $513,072 which covers the period from April 16 to July 8.
Sanford chief executive Volker Kuntzsch said the intention was for some operations in Tauranga to continue.
"We would continue to unload seafood at the Tauranga site under the proposed arrangements and we plan to retain a number of staff in that area."
Tauranga Chamber of Commerce chief executive Matt Cowley said Sanford had been in the city for decades and the impact would be felt further than within the industry.
"They've been a really integral supporter of the community. They're funded a lot of sport and not-for-profits during their time here."
Cowley said it was "unfortunate news to hear".
Former Tauranga mayor Greg Brownless said he was surprised and saddened to hear about the proposed closure because fish processing companies do well in New Zealand.
However, Brownless said if Sanford did decide to close its Tauranga plant, it would provide an "ideal opportunity" to look to secure the site for the $50 million University of Waikato Marine Research Centre project.
Sanford have now entered a consultation period with feedback sought by Monday and would meet with staff again next Wednesday to discuss the feedback.