Bega Group has announced it will wind down its Peanut Company of Australia (PCA) operations at Kingaroy and Tolga over the next 18 months.

Up until now, these peanuts ended up in jars of Aussie favourite Bega Peanut Butter.

The closure marks the end of an era for Queensland’s peanut industry, with an expected impact on around 135 factory workers across the two regional sites, as well as leaving around 60 farmers in limbo.

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Despite investments and upgrades since Bega acquired the business in 2017, PCA has struggled under annual financial losses of $5 million to $10 million, the company said.

Attempts to sell the business failed, forcing the company to opt for closure.

“We understand the impact this decision will have and will support employees and growers through this difficult transition,” CEO Pete Findlay said.

The decision is a significant blow for local growers such as Richard Standen from Tolga, as PCA was the only buyer for their crops.

“Tolga has no other facility for shelling and storage,” Standen told 7NEWS.

“We’re virtually at the end of our industry here unless someone invests but I can’t see that happening.”

Peanut farming made up about one third of Standen’s operation, with the rest in maize and grass seed.

He said the closure would hit growers’ incomes hard and force many to find alternative crops, a challenge given limited market options.

The broader industry has faced rising competition from imports, higher input costs, and stronger returns from other crops — factors pushing production and profitability down.

Standen said it was the loss of a family legacy, with generations of his family involved in peanut farming.

“It’s gutting. We’d hoped the industry would continue, but the writing’s been on the wall for a while,” he said.

Organised peanut farming began at Kingaroy in Queensland in 1923.

Towering over the town, the Peanut Company has been a pillar of the local economy for decades.

With the loss of a more than a century-old agricultural industry, Kingaroy now faces a major setback.

The closure has sparked anger in the South Burnett community.

“This is a deeply disappointing blow for the region,” Member for Nanango Deb Frecklington said.

“Bega is a highly profitable multinational company and this decision will devastate the local community, who have been loyal to the brand for many years.”

Federal Nationals leader David Littleproud described the move as a major blow for the agricultural sector.

“PCA had been processing 19,000 tonnes of Australian-grown peanuts every year in Queensland,” he said.

“Today is a tough day for Queensland agriculture and Bega’s employees and contractors.”

Bega will offer redundancies and support to employees at the two sites, the company stated.

However, it will retain processing facilities in Crestmead and Malanda.

Local businesses linked to the peanut industry, including transport, machinery, and chemical suppliers, are also expected to feel the impact, Standen said.

Growers are set to meet with Bega next week to discuss options.

The group’s portfolio includes well-known brands such as Bega Cheese, Vegemite, Dairy Farmers, Daily Juice, Zooper Dooper, Dare Iced Coffee, Masters, Big M, Mildura Juice, and Zoosh .