A week after Taypack walked away from Asda, the UK’s largest ready meals supplier is abandoning a contract with Marks & Spencer.

Northern Foods is mothballing its Fenland Foods factory in Grantham for two years from August, as it failed to “find a business model that was profitable” with M&S.

The factory supplied Italian ready meals to the UK retailer, and the announcement is likely to have an impact on suppliers of onions and other produce, as well as on the 730 workers that are employed at Fenland Foods.

Northern Foods had worked hard to negotiate higher prices with M&S as its own costs of raw materials have climbed, but had failed to achieve success.

Meanwhile Taypack told freshinfo that it is already in talks with potential new customers. “We are currently marketing the remainder of this season’s raw material in storage, and the enquiries which have arisen in the past week have been very encouraging,” said ceo George Taylor. “However, discussions are at a very early stage and we remain in a strong position to assess all options which will safeguard the interests of the company and our grower base.” He said that the company had received overwhelming support from its grower network which includes Taygrow Produce Ltd - a 25-strong member group which grows exclusively for Taypack. “Many of our growers have been with us before the Asda contract and they trust that we are acting in their best interests,” he added. "Taypack Potatoes remains in a period of consultation during which it will review its current business structure, including the possibility of redundancies."

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