Factory closures mount as New Zealand manufacturing faces its toughest stretch in years

New Zealand’s manufacturing sector is shedding factories and workers at an alarming pace, with a wave of closures across food processing and timber milling prompting calls for a parliamentary inquiry and raising uncomfortable questions about what the country actually makes — and who will supply essential goods if multinationals keep walking away.

The most visible symbol of the crisis is Heinz Wattie’s, which confirmed this month it will close three manufacturing facilities. Its La Bonne Cuisine factory in Auckland, its frozen vegetable factory in Christchurch, and its Gregg’s coffee facility in Dunedin will all shut, along with frozen packing lines at the company’s King Street plant in Hastings. Between 300 and 350 jobs will be lost. Some of the workers affected have spent more than 45 years with the company.

Wattie’s managing director Andrew Donegan framed the closures as unavoidable. “If we don’t make these changes now, it’s going to be quite challenging to run the business for the future,” he said. The company’s revenue had been flat for nearly a decade while costs rose steadily. A significant blow came in 2021, when Foodstuffs removed Wattie’s frozen ranges from New World, Pak’nSave and Four Square stores, replacing them with Pams and Value house brands.

The union representing affected workers was blunter. E tū director Finn O’Dwyer-Cunliffe said the closures had been “dumped” on workers at short notice and accused multinational companies of “making a choice to walk away.”

Wattie’s is not alone. McCain Foods announced in March it would close its Hastings vegetable processing plant on Omahu Road by January 2027. The plant processes more than 50,000 tonnes of vegetables each year, and the closure sends ripples through a wider supply chain of growers, truckers and seed companies in Hawke’s Bay. Central Hawke’s Bay Mayor Will Foley said the McCain closure would have “a massive effect on our district, which is already trying to grapple with the Wattie’s restructure.”

Meanwhile in the Far North, Japanese-owned Juken NZ has announced it intends to sell or close two timber mills in Kaitāia — the Northland Mill and the Triboard Mill — citing “ongoing structural and market pressures.” More than 200 workers are employed across the two sites. Juken managing director Hisayuki Tsuboi said the company had not been able to return the mills to “a sustainable footing under their current operating model,” with high electricity costs and weak export demand cited as key pressures.

For a town of roughly 6,000 people, the potential loss of the mills would be devastating. The mills also supply around 30 percent of Kaitāia’s water. An eight-week tender process is currently under way, and Northland MP Grant McCallum has said an investment group that includes local business people is in discussions to buy the mills as a going concern. “I would not celebrate until a deal is signed and sealed,” he said.

Far North Mayor Moko Tepania has been advocating for central government support, particularly around energy costs, which he described as a key factor threatening the mills’ viability.

The Green Party has called for an urgent inquiry into the food factory closures, with agriculture spokesperson Steve Abel arguing that “understanding the extent of the impact and risks is a matter of urgency that the Primary Production Select Committee should open an inquiry into.” Abel flagged energy costs, foreign ownership, supermarket pricing power, and the regulatory environment as potential factors driving the closures.

Minister for Regulation David Seymour pointed to red tape around vegetable growing as a contributor, saying he wished new legislation had been in place sooner, but that the government was “passing it as fast as any government could.”

The broader job market tells a similar story. Official unemployment sits at 5.4 percent, and 220,839 New Zealanders were on Jobseeker Support as of February — around 6.8 percent of the working-age population. Statistics New Zealand data shows 8,000 construction and manufacturing jobs were lost in the year to February 2026 alone. Across the economy, EB Games closed all 38 of its New Zealand stores, NZ Post has been shutting service counters, The Warehouse Group cut 270 head office roles, and Lincoln University made 40 people redundant.

Economist Shamubeel Eaqub has pointed to a long-running pattern of the hollowing out of New Zealand manufacturing — Unilever’s Petone closure in 2014, Cadbury’s Dunedin factory in 2018, James Hardie’s Penrose plant in 2020 — and argued that economic downturns tend to accelerate this process rather than reverse it.

The food security implications are particularly concerning for some analysts. David Hadfield from Process Vegetables NZ has warned that as supermarkets increasingly source frozen vegetables from China, South Africa, Thailand and Italy to fill the gap left by local producers, New Zealand becomes more exposed to supply chain disruptions — as recent Middle East shipping difficulties have already demonstrated.

Buy NZ Made executive director Dane Ambler has described the situation facing manufacturers as “a perfect storm” of rising costs, weaker consumer demand, and intensifying competition from imports and house-brand products backed by supermarket buying power.

The Juken situation in Kaitāia will be the next test. The tender is still live, the potential local buyer is still negotiating, and hundreds of families are waiting for an outcome. If that deal falls through, it will add another chapter to an already grim few months for the workers and communities who make things in this country.

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