Morrisons is set to bolster its processing division with the addition of a major new fish factory to its portfolio.

The retailer is to invest in the former Kwok Foods factory on the Europarc site in Grimsby, to set up a primary fish production facility.

Giving employment to 170 people, the facility will be operational by September. A second phase of development, due to be completed by February 2013, will see an additional 60 staff taken on.

The news represented a fantastic opportunity to build on Grimsby’s existing strength as the leading UKs seafood manufacturing cluster, said Jason Longhurst, head of development at North East Lincolnshire Council. “We now look forward to seeing a rebalance in the economy in view of the loss of in excess of 1,100 jobs in the food manufacturing sector over the last three years.”

Setting up the facility would deliver mouth-wateringly fresh fish into our stores, said Morrisons chief executive Dalton Philips. “Nobody else is buying direct from the quayside but we’re doing it,” he said.

The news follows industry rumours that Morrisons was eyeing a move into fish processing after creating a new head of fish role, taken up by former Cumbrian Seafoods executive Frank Green, in January.