Chicken meat processor Baiada will close its Melbourne plant, cutting up to 120 jobs and 16 contracts with growers.
The company will stop processing in Victoria by March 31 next year, poultry managing director Simon Camilleri says.
Distribution operations will continue.
The decision to close was "one management agonised over, and tried to avoid," Mr Camilleri said in a statement on Tuesday.
"All employee and contractual obligations will be met and we will work closely with the National Union of Workers to find staff new roles with other employers," he said.
"We will also collaborate with the Victorian Farmers Federation to assist growers find alternate growing opportunities in the poultry meat or egg laying industry. "
Victorian Farmers Federation chicken meat president Allan Bullen told AAP the closure had been imminent, especially with Inghams flooding the market with cheaper chickens.
He said the concern now was finding alternatives for the growers who were supplying about 350,000 chickens a week to the plant.
"Between those 16 farms, there's probably $40 million worth of assets that are worthless now," he said.
The National Union of Workers estimates about 110 to 120 workers will be made redundant by the closure.
