Page last updated at 08:44 GMT, Tuesday, 13 October 2009 09:44 UK

Closure plan for Brown Ale plant

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Newcastle Brown Ale has been brewed on Tyneside since 1927

Production of Newcastle Brown Ale is set to cease on Tyneside after its owners announced plans to close their brewery in Gateshead next year.

Scottish & Newcastle (S&N) wants to shut the Federation Brewery in Dunston and transfer operations to the John Smith's factory in Tadcaster.

The move, which would result in the loss of 63 jobs, is being blamed on falling beer sales in the UK.

Brewing of the ale moved across the River Tyne from Newcastle in 2005.

Newcastle Brown Ale has been brewed on Tyneside since 1927.

Jeff Tate, regional organiser for the Unite union, said: "It's not Newcastle Brown Ale if it is not made here. We are very disappointed."

The closure of the Federation Brewery will be mourned by all who recognise this landmark on Gateshead's skyline
James Ramsbotham
North East Chamber of Commerce

Paul Hoffman, S&N operations director, said: "Clearly this is a sad day, but the proposal to close Dunston is not a decision we have taken lightly.

"Nor is it a reflection on the employees at the site who have done an excellent job over the last few years in a very challenging market."

He said falling beer sales had created overcapacity in the UK brewing sector and the proposals were designed to ensure the firm remained competitive in the future.

He said the Dunston site was currently running at about 60% capacity and that the firm's ability to consolidate beer production at other sites presented "a strong case for closure".

James Ramsbotham, chief executive of the North East Chamber of Commerce, described the news as a blow to the region.

He said: "Fans of the brew will be disappointed to learn of this change because the unique flavour flows from the rich heritage of this part of the world, which is integral to its appeal.

"Likewise, the closure of the Federation Brewery will be mourned by all who recognise this landmark on Gateshead's skyline."



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