The creamery now begins a consultation period

Staff at the Aeron Valley creamery at Felinfach were told the news on Monday.

In a statement, owners Lactalis McLelland blamed the closure on mounting losses. But it said some staff could be offered work in Scotland.

Local AM Elin Jones said it would have a "devastating impact" on top of the loss of 115 jobs at the Dairygold cheese packaging plant last year.

Lactalis McLelland's industrial director, Matt Glover, issued a statement on Monday saying a comprehensive review of the company's operations had "examined and exhausted all possible alternatives to closure".

"Unfortunately, we have had to begin today a 30-day consultation process with our staff and it is with deep regret we have informed them they are at risk of redundancy," he said.

"This is particularly sad as we have a great team at the creamery, who have worked hard to turn things around since we bought Aeron Valley just over two years ago.

New jobs

"However, despite investment in the plant and the staff's outstanding efforts, the losses have continued to mount up."

He added: "We will do everything possible to support our employees during this difficult time, including providing them with various forms of assistance to find new jobs."

Mr Glover confirmed alternative employment would be offer to some staff, although this would be in Scotland.

Ceredigion AM Elin Jones said the closure would have a "devastating impact" on the community of Felinfach and said she would raise the issue in the Senedd on Tuesday.

"This closure is in the heart of the west Wales dairy field, and is devastating news for the workers and their families," she said.

Irish company Dairygold closed its plant at Felinfach last April.

Last week it was given a final warning of legal action over the repayment of a grant of more than �650,000 it received to expand its business in 2002.