At least 124 jobs are to be lost at Gallagher's bakery at Ardara in Co Donegal.
The company, which employs 189 people, announced this afternoon that it is going to close its frozen bread section which, it says, is unsustainable in the long term.
It is understood that some of the frozen bread operation will be transferred to the parent company's other plant in Dublin.
The company says efforts are being made to save 65 other jobs in Donegal through redeployment to its other plant in Dublin and through the possible sale of its fresh bread section.
'There has been a serious market contraction in Ireland and the UK in recent years. Increasingly difficult market conditions, increased commodity costs, declining sales and reduced product prices have put immense pressure on the business', Declan Gallagher, managing director of the company, said.
He said this had been exacerbated by the weakness of sterling which has affected the company's ability to compete in the UK market.
The business was established by the Gallagher family in 1968 and is now part of the Swiss food company, Aryzta. It produces its own soda and other breads as well as the French Mill brand and it sells to Tesco, Dunnes Stores and Harrods of London.
150 Baxter workers facing 4 month lay-off
The work on the contaminated production line at the Baxter Healthcare company in Castlebar, Co Mayo will shut down on Monday for approximately four months.
Up to 150 workers will be laid off while the repair work is carried out.
Representatives from SIPTU are meeting the production staff to discuss the implications of today's decision.
A compensation deal has been offered to the workers by the company and will be voted on in the coming days. It is understood that SIPTU has recommended its members to accept the deal.
