Vegan milk maker Oatly scraps plans for 200-jobs creating production hub in Peterborough

Vegan milk giant Oatly has confirmed it has scrapped plans to open a state-of-the-art manufacturing hub in Peterborough that was expected to create 200 jobs.

The oat milk maker says the decision was taken after the company found better ways to make use of its existing facilities.

The Swedish company announced three years ago that it intended to build one of the world’s largest plant-based milk factories at Peterborough Gateway with production to start in 2023.

It said the production centre would turn out 300 million litres of oat drinks with the capacity to increase its production to 450 million litres.

And work on site had got underway with the company even donating 5,000 tonnes of soil to Peterborough Rugby Union Football Club two years ago helping to create four new rugby pitches.

Now the company has revealed that it decided seven months ago to drop the plans after the project had already ‘been on hold for some time’.

Bryan Carroll, general manager of Oatly UK & Ireland, said at the time: “After undertaking a thorough review of our supply chain network, we have identified new ways to service the UK market that better utilises our existing facilities across Europe.

"Therefore, we will not move forward on the completion of the Peterborough facility.”

Three years ago, Oatly lost a legal battle over a trademark dispute with a small farm near Peterborough.

It had claimed a product called PureOaty that was made and marketed by the family-run Glebe Farm at Huntingdon represented a trademark infringement and unsuccessfully took the dispute to the Royal Courts of Justice

Founded 30 years ago, the company, which is a global leader in the manufacture of oat drinks, was one of a number of food and drink firms that several years ago were set to move to Peterborough.

Those that did included American spice giant McCormick, which created about 300 jobs at a production centre at Peterborough Gateway, and food supplier AM Fresh, also at Peterborough Gateway, with about 120 staff.

Figures show there are 475 businesses in the Peterborough area specifically involved in food and drink, employing a total of 7,685 people.

These include dairy products maker Meadow Foods, in Fengate, cereal producer Pioneer Foods, drinks giant Kingsley Beverages, chilled foods firm Hain Daniels, sandwich maker Greencore, brewers Oakham Ales, and chips and fries giant McCain Foods while Bakkavor, which produces meals, salads and pizzas, has factories at nearby Bourne and Spalding.

Andrew Burgess​​​​, agricultural director at Burgess Farms, at Yaxley, and also president of Peterborough Rugby Union Football Club, said: "Of course I’m disappointed that they have made this decision because we need good companies in our city.

“Donating the soil actually saved them money and they didn’t materialise as a sponsor for the rugby club.

He added: “If there are any local businesses who would genuinely like to partner Peterborough Rugby Club then please contact me on [email protected]”