Paulig is set to halt production at its spice factory in Sweden, relocating operations to its facility in Estonia due to increasing input costs.
The Mölndal factory, situated south of Gothenburg and leased by the company, produces spices for Paulig’s Santa Maria brand, recognized for its spices, Tex-Mex products, and BBQ sauces.
In a statement, Paulig noted that the closure will impact all 86 employees at the Mölndal site as well as roles in the Mölndal office, totaling approximately 105 staff members affected. The company aims to finalize the transition by summer 2027, with a decisive resolution pending discussions with labor unions.
Importantly, these planned changes will not affect Paulig’s other operations in Sweden. Lenita Ingelin, SVP of the branded business area at Paulig, emphasized, “This change aims to strengthen Paulig’s long-term competitiveness. Rising production costs have put pressure on our profitability, and this change would enable us to handle rising costs more effectively.”
The Finnish group intends to concentrate spice production in Saue, Estonia, where it has maintained a factory producing spices, salsas, and sauces since 1993. Currently, the Saue facility employs 84 individuals and exports over 80% of its output. Unlike the rented facility in Mölndal, Paulig fully owns the Saue factory, which offers potential for expansion. Following the factory’s closure in Mölndal, the Saue plant will become Paulig’s sole site for spice production, as outlined by Ingelin in a conversation with Just Food.
Post-closure, marketing, sales, R&D, and other support functions will continue to operate from both the Mölndal and Solna offices. Paulig currently employs approximately 490 staff in Sweden, which also includes a tortilla plant in Landskrona and a warehouse in Kungsbacka. In 2024, the company achieved sales of around €1.2 billion ($1.4 billion).
In July, Paulig announced plans to invest €12 million to enhance production capacity for its Tex-Mex range at its Berga plant in Barcelona, Spain. The new production line is expected to be operational by the end of 2026, potentially creating up to 30 jobs over the next five to six years.
Recently, Paulig has expanded its portfolio through strategic acquisitions. In December 2024, the company acquired the Dutch brand Conimex from Unilever to bolster its Asian food business in the Netherlands. This followed its acquisition of UK-based Panesar Foods, a producer of sauces, salsas, and condiments, in October 2024.
By implementing these changes, Paulig continues to adapt to the evolving landscape within the food and beverage industry, addressing key consumer trends and positioning itself for future growth.
