Jobs could be at risk at Müller's giant Severnside Dairy in Stonehouse after the firm announced that it is proposing to relocate part of its operations to other sites.

The company is reviewing where it manufactures butter, potted cream and FRiij as part of a £100million cost and margin improvement programme.

In an announcement, the firm said that the "cost of production at Severnside is higher than any of our other sites."

It added that the site which produces butter, FRiij, private label flavoured milk, cream, milk and powders "compares unfavourably in terms of cost complexity and utilisation with other dairies."

The firm have confirmed that a 45 collective consultation will commence on Monday, February 17 to examine ways to simplify and restructure operations at the site."

The announcement said: "Whilst it is too early to assess the impact on jobs, in the event that a decision is taken to proceed with the proposal, affected employees will be offered opportunities to relocate, or will be supported should this not be possible.

"Other products made at Müller's Severnside dairy are not affected by the review."

Rob Hutchison, Operations Director at Müller Milk & Ingredients said: "Whilst MMI has made significant progress in the past year, our business is still loss making.

"We must maintain our momentum if we are to achieve sustainable profitability.

"Cost of production at Severnside is higher than any of our other sites and this review will look at how we can best meet the needs of our customers, in a manner that is much more simple and cost effective.

"We are taking action to ensure we can achieve cost leadership in everything that we do, while meeting the requirements of our customers both now and in the future.

"We understand that this is an unsettling time for our employees and will work hard with them and their representatives during this period to find the right solutions."