Poultry giant 2 Sisters has announced it may close its Llangefni factory, which employs 730 people, following a review into the processing site.
2 Sisters Food Group said the site, located in Anglesey's second-largest town, was 'not sustainable' as the firm continues to battle the bird flu crisis and surging production costs.
A spokesperson for the poultry processor - one of the UK's largest - said the factory was "old, one of our smallest sites and lacking space to be efficient."
"The cost to produce here is higher, and it would require significant investment to bring it up to the standards of our other factories.
"Our products can be made more efficiently elsewhere across our estate," the spokesperson said.
The Llangefni site was bought in 2013, but despite £5 million being invested there, the company said it lacked efficiency.
The statement added: "Clearly this will be extremely disappointing news for our Llangefni colleagues, and it is no reflection of their continuing hard work and commitment.
"However, we have a duty to remain competitive and protect our wider business on which many thousands of people depend."
The firm said it would now hold consultations with all affected employees and their representatives, while exploring options before making any final decisions about the closure of the site.
The statement said: "These options will include all redeployment opportunities in the region with the help of all relevant support agencies, both inside and outside the business."
Responding to the news, local MP Virginia Crosbie, who represents the constituency Ynys Mon, said the closure was "devastating" for the local area.
"It appears [2 Sisters] has been badly affected by a range of issues with energy cost rises in April being a major part of the decision to consult on a closure to protect other parts of the business," she said.
"I will be speaking to the unions very soon and I would support a task group being set up to help navigate what is happening and what could happen, if the factory closes."
