Baltic, Foodstuff, Investments, Latvia, Markets and Companies

He indicated that the current situation in the bread market is complicated as the costs continue to increase, while bread consumption level continues to drop.

"The total production capacity in the Baltic market is way higher than the market demand, therefore, in order to consolidate our competitiveness, we have decided to implement various structural changes to the production process," Kujala explains.

Tallinn's production lines will be moved to bakeries in Ogre and Kaunas, and the Tallinn plant will be closed in April 2015. Kujala added that the bakery's shutdown will affect no more than 95 employees.

Fazer plans to invest a total of EUR 5 million and create 40 new jobs in the Ogre bakery. The new production facility will be built by the fall of 2015.

Managing Director at Fazer Bakery Baltic Mindaugas Snarskis said that by expanding the plant in Ogre, Fazer's competitive capacity will increase in the Baltic market.

"The new plant will export its products and also offer new products on the Baltic market. Our long-term aim is to provide consumers in the Baltics with high-quality products," Snarskis says.

Fazer Latvija turnover was EUR 18.41 million in 2013. Fazer Latvija is one of the leaders in the bread market, which operates under two brands – Fazer and Druva. The company currently has 250 workers, and is the largest employer in Ogre.

Meanwhile, Fazer Group reached a record-high turnover in 2013 – EUR 1.7 billion, according to the company's 2013 financial report.

“The market situation in the Baltic countries is very challenging. There is overcapacity in the Baltic bread market, and the consumption of pre-packed bread is declining. Consolidating the production we will increase our efficiency. Our 5 million euro investment in Latvia in new production facilities will open up new opportunities for us,” said Petri Kujala, Managing Director of the Fazer Bakery Business Area.

Fazer has 18 bakeries in total. Six of them are located in Finland where Fazer also has 46 in-store bakeries in supermarkets. Five of the bakeries are located in Sweden and four in Russia. Fazer also has one bakery in each of the Baltic countries.