Award-winning cheese manufacturer King Island Dairy could be sold amid a review by owner Saputo of operations on the remote outpost.
Saputo's "strategic review" of its King Island Dairy facilities will consider "commercial and financial alternatives", including a potential sale to a third party.
Dairy giant Saputo purchased King Island Dairy, which makes highly acclaimed blue, cheddar, brie and camembert specialty cheese, in 2019.
Saputo has told the roughly 60 employees at the facility on the tiny island northwest of Tasmania about the review and says management will work closely with them throughout the process.
Suputo says it intends to keep King Island Dairy operations running at regular capacity while it assesses possible future scenarios.
The company is simultaneously investing $27 million in capital projects in Tasmania and Victoria, including $8 million to improve climate, water and waste performance.
"We remain focused on maximising our return for every litre of milk to further enhance (Saputo's) position as a high-quality, low-cost processor in Australia," Saputo president and chief operating officer Leanne Cutts said in a statement on Wednesday.
"As King Island Dairy's historic roots are deeply embedded in the region, we hope to find a buyer for the facility to ensure the continued success of its renowned specialty cheese products.
"We recognise the potential impact any decision may have on the King Island community, especially our employees and dairy farmers.
"We are committed to thoughtfully considering all possible scenarios before any decisions are made."
Milk for King Island gourmet cheeses is sourced from a handful of local farms on the picturesque island which has a population of around 1600.
Saputo is among the largest dairy processors in Australia and describes itself as one of the top ten dairy processors in the world.
King Island cheese making dates back more than a century, with its unique climate providing lush grazing for cows and unusually sweet milk.
