Dairy Queen Corp. plans to close its three remaining stores and open a new facility in the U.S., the company announced Thursday.
The move is expected to close by the end of 2018, though the move is subject to a final regulatory review.
“The decision to close our dairy stores in Canada, Australia and the U, Australia is a strategic one that will enable us to focus on our expansion strategy and provide us the resources necessary to accelerate our growth and accelerate our global expansion,” Dairy Queen Chief Executive Officer Mark Peltz said in a statement.
The company will begin to move its operations to the new facility, and will begin shipping its products by the summer of 2019.
The announcement comes as Canada grapples with a shortage of milk and the dairy industry has been hit hard by an increase in milk prices.
The Canadian dairy sector has been one of the biggest economic drivers in the country, with the sector accounting for almost half of the country’s gross domestic product (GDP) and nearly a third of its total employment.
Canada’s milk market has seen an increase of more than 8 per cent in recent years, driven by higher milk prices, but the sector is still struggling to grow.
Canada is home to roughly 3.4 million dairy farmers and a quarter of the nation’s population.
“We will continue to support the Canadian dairy industry with strong support through our supply chain and with the support of the Government of Canada,” Peltzeck said.
The closure of Dairy Queen’s stores will create 1,000 jobs in the United States, according to the company.
The U.K. and the United Kingdom have been dairy exporting destinations for the company, while Canada has been expanding its market through the purchase of milk from other countries.
The news comes as the company is also planning to close a store in Australia, where the company has been a leading exporter of dairy products.
The store closure comes as a result of the current drought in Australia and New Zealand, which has caused a steep drop in milk production in those two countries.
Dairy Queen has also recently announced plans to expand its U.A.E. operations, which are based in the Netherlands.
The retailer plans to increase its U., Australia and Canadian operations in the next two years.
Peltzing said the company would also be opening new stores in New Zealand and the Netherlands to further diversify its U, A.E., and Canada operations.
“As the market evolves and more countries come online, we are committed to maintaining our focus on delivering a better quality, fresher, freshest and freshest food experience to our customers, our suppliers and our associates,” Pilez said.