A proposed joint venture between the vegetable grower Produce World Group and Lincolnshire Field Products (LFP) has put up to 340 jobs at risk.

Produce World is planning to close its Butterwick site and its factory at Swinderby – both in Lincolnshire – which employ 250 and 90 full-time staff respectively.

The JV, once completed, will be responsible for the growing, harvesting, packing and marketing of brassicas, with all activity to take place at LFP’s base in Wykeham, just outside Spalding.

Produce World said the restructuring would consolidate the company’s recent growth and put it in the “best possible position” to face the challenges of an increasingly competitive marketplace.

The group said about 60 jobs would be created at Wykeham, along with a number of others at its site at Isleham in Cambridgeshire, in a £10m investment. All processing and packing of conventionally grown root vegetables will move to Isleham, where additional processing and storage facilities are being built to cope with the additional tonnage, Produce World added.

“At Produce World we are growing our business and developing a structure which will enable us to meet the current and future challenges in the industry,” executive chairman Neil Fraser said. “We are operating in a low margin business and more consolidation across the industry is inevitable. At the same time our customers are experiencing a period of unprecedented competition and changing consumer shopping habits.

“We have acted to ensure we can meet these challenges and make the Produce World Group sustainable for the future. We are committed to the long-term for the business and for fresh vegetable growing in Lincolnshire and across East Anglia.”

At present across all its sites in East Anglia and Lincolnshire, the group employs about 1,000 staff. The JV with LFP would increase turnover at the overall Produce World Group to £250m – making the company one of the biggest growers and suppliers of fresh vegetables in the UK.

“Consolidation in fresh produce supply chains is inevitable as a result of the pressure of the highly competitive retail environment, declining consumption, and changing consumer shopping habits,” added LFP commercial director Martin Tate.

“The combination of the two businesses will ensure that we can compete in the market place and have a sustainable future.”