The company says the bakery's closure is part of an ongoing project to improve manufacturing efficiency across its baking network.

The Lal Lal Street bakery makes bread products, including Lawson's bread and fruit loaf, and has operated out of the same site for 60 years.

In a statement, Goodman Fielder said it was consulting directly with impacted employees, with 34 roles expected to be made redundant.

The Courier understands the bakery has many long-term employees who were left shattered but not surprised by the news.

The company has already closed three other bakery sites in the past year as part of its ongoing plan to improve efficiency.

Managing director of Goodman Fielder's Australian business, Andrew Hipperson, said Goodman Fielder would transfer production from the bakery to its other sites at Forestville and Clayton, but retain distribution from the Ballarat site to continue to service customers across the region.

"This is a difficult but necessary decision as part of our ongoing strategy to create a more efficient manufacturing footprint in our baking business," Mr Hipperson said.

"While the bakery is expected to close by November 2013, we are continuing to invest in our other facilities to ensure we continue to reliably supply our customers with fresh, quality products.

"Optimising our manufacturing network is part of our overall strategy to extract scale benefits from consolidating our supply chain to create a more sustainable bakery business."

The company is looking to redeploy employees where possible to fill vacancies at other Goodman Fielder sites, with full redundancy provisions and career support also available, the statement said.

"We understand the impact these decisions can have on our people and our immediate priority is to ensure that our employees are supported through this process," Mr Hipperson said.

rachel.afflick@fairfaxmedia.com.au