Dairy cooperative Sodiaal to shut two production sites in France

(Reuters) - French dairy cooperative Sodiaal said on Tuesday it would close two production sites, cut 316 jobs and invest 600 million euros ($675 million) over five years as part of a wide restructuring plan due to overcapacity.

Sodiaal, the third largest dairy cooperative in Europe, which owns brands such as infant milk Candia, is suffering from a sharp drop in babymilk sales worldwide, particularly in China, and lower milk consumption in France despite a rebound during the pandemic lockdown, it said.

The new investments would be split between 450 million euros on cheeses, premium milks, butter, cream, fresh dairy products as part of its takeover of Yoplait from General Mills last year and 150 million euros on diversification, it said .

"With this project, Sodiaal will approach 2030 with enhanced competitiveness, which will enable it to meet the agro-ecological challenges of the French dairy sector, but also to strengthen its positions in a global market which remains promising (+21% by 2030)," it said in a statement.

In 2019 Sodiaal had taken control of infant formula production and other operations at a site in northwest France under a deal with Chinese operator Synutra.

($1 = 0.8883 euros)

(Reporting by Sybille de La Hamaide)