"At Hadsund, we produce highly specialised products for key markets such as Japan, England, Sweden and Denmark, and it is a production, we expect to increase by 50 per cent in the coming years. Therefore, we need to look at capacity and ensure timely production," said production director of Danish Crown Søren F. Eriksen.

Since Tulip Food Company in December last year closed sausage factory in Sdr. Borup teh company has been looking at the possibility of moving the Hadsund production to the empty sausage factory, which is close to the Danish Crown's headquarters.

"The plan is to close Hadsund down when the new plant is ready by the end of 2011. The new plant will have the same number of jobs and employees will be given the oportunity to move," Søren F. Eriksen said.

Danish Crown said that the factory in Hadsund is inappropriate for expansion and a new factory will provide an opportunity to produce more competitively.

The company added that ongoing new environmental requirements would be difficult to meet in the older plant which is in a densely populated area.

Hadsund currently has 119 employees.

Meanwhile, reports from Denmark say that government officials, who monitor work at the Ringsted, Esbjerg and Herning plants, walked out this week in a dispute over their charges.