CHEESE producer Cricketer Farm could stop producing and packing at its Nether Stowey factory after suffering “significant financial losses” over the last year.

Managing director Greg Parsons said consultations were continuing with staff but the firm was looking at ceasing all cheese production early next year.

He blamed “challenging times” in the dairy industry which had been compounded by the loss of a major contract in January 2016.

Cricketer, which employs almost 70 people, currently supplies Cheeky Cow Cheddar cheese to Tesco, Asda and Spar stores.

In a statement, Mr Parsons said: “The global dairy industry is in turmoil due to the oversupply of milk products and the strong pound.

“UK exports have been devalued, especially in the wake of EU milk quotas being lifted.

“Some retailers have decided to cut costs by reducing the number of suppliers and, as a result, Cricketer Farm has lost supply to a major customer from January 2016 which is integral to the decision to stop production.”

Mr Parsons said the company had tried to develop more “added value” business opportunities, such as the Cheeky Cow brand, and had attempted to enter new sectors, including food service and exports.

“However, we have been unable to grow these areas quickly enough to ensure a sustainable future,” he said.

The company said the closure was still subject to consultation with staff but conceded that the future looked bleak.

Mr Parsons said: “The Cricketer Farm directors are forced into this conclusion as they see no realistic prospect of cheese prices being at sufficient level to provide satisfactory returns to both processor and farmers.

“The directors are committed to managing the closure diligently and sensitively.

“They will focus on providing as much support and advice as possible to employees and supplying farmers.

“Many of the local workforce have been at Cricketer Farm for decades and have been extremely loyal and hard working.

“Directors will help staff to identify new opportunities through the phased exit from the cheese industry.”

He said the company would also stand by its contractual commitments with milk suppliers and would try to find alternative opportunities for them wherever possible.