A company spokeswoman said an article in The Weekly Times was inaccurate.

"Unfortunately this just isn't correct and this assertion wasn't put to us by the journalist - otherwise we would have corrected him straight away," she said.

"I've confirmed with the project team this morning that we've received no contact from any dairy companies interested in purchasing the site."

The spokeswoman said the company had explored all options for the site, including selling it but there had been no genuine interest.

She said in a low milk pool environment, the most responsible option was to close.

"These sorts of claims are really unhelpful as they give our people false hope, so we want to make sure the record is correct," she said.

"We'll be chatting to our people today as part of our ongoing support to them and explaining that the story isn't correct."

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The spokeswoman said the company had no immediate plans for the Dennington factory.

"It's too soon to say what will become of the site, including the hall, however we've set aside money to responsibly close it," she said.

"We'll work with local stakeholders and community groups to minimise the impact on them."

The spokeswoman also confirmed the milk dryer at Fonterra's Cobden factory was currently not in use.

"Early this year we made the decision to extend the annual shutdown of the dryer to June 2019 - due to lower seasonal milk volumes - and it's due to start up again shortly," she said.

"However, the Cobden plant's butter and fresh milk and cream have not been affected by the extended annual shutdown."

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