A LARGE North-East dairy has gone into administration, placing 88 jobs at risk and hitting hundreds of farm suppliers.

Rock Farm Dairy, in Wheatley Hill, County Durham, has suspended trading with immediate affect.

The company, which has an annual turnover of around £17m, processes and bottles milk and cream which is distributed to a diverse customer base across the region.

Its facility can process up to 150,000 litres of milk per day.

Stephen Oldfield and Ian Green, of PwC, were appointed joint administrators on Thursday by the company directors.

PwC said the appointment was a result of disappointing trading performance due to a “significant rise in bad debts from customers combined with an increasing cost base”.

The administrators said the company had also had difficulties passing price increases on to customers.

This has had an adverse effect on margins, culminating in the business experiencing liquidity difficulties, PwC said it was trying to secure a third party interested in a tolling arrangement where the company facilities would be used for a fee payable to the administrators.

Employees have been told that their jobs depend on the result of urgent talks with potential tolling partners during today and potentially over the weekend.

Stephen Oldfield, joint administrator said: "Trading has suffered in recent months and the administration is clearly disappointing news for all of the stakeholders, and employees in particular.

“However, we are looking to secure a rapid tolling agreement for Rock Farm Dairy. We are very keen to speak to anyone who might have an interest in such an arrangement."

The NFU said it was extremely disappointed at the announcement.

A spokesman added: “This news is very sad not only for the region’s dairy sector but also for the many local customers and schools who have enjoyed milk processed and delivered by the dairy.

“The family behind the business are well respected members of the local dairy farming community and have worked hard to support local producers.

“This turn of events will, we’re sure, be devastating for them as well as impacting hard on their many farmer suppliers.”

The NFU said it had made contact with PwC to seek clarification on various issues on behalf of its members.

“We understand that all farmers’ milk was collected this morning by alternate dairies and the company together with the administrators are planning a farmers’ meeting next Tuesday, when we hope more information will be forthcoming,” the spokesman added.

Affected NFU members should call NFU Callfirst on 0870-845-8458 for initial advice and to log their details.

* Does your farm supply Rock Farm Dairy? Call reporter Joe Willis at The Northern Echo on 01325-505067.