Further concerns have been raised about the future of Guinness's brewing operations in Dundalk after a briefing document signed by Mr Allen Peeters, managing director of Guinness Supply, said the company is to stop brewing Harp for the US market in the town.

The Dundalk brewery produces 300,000 hectolitres of Harp per annum which is exported to the US. Mr Peeters said in the document that the decision to move Harp production for the US market to Canada was based on "current costs of production [that] are seriously uncompetitive, to the point that it was destroying value and about to be delisted".

The Dundalk brewery currently produces 300,000 hectolitres of Harp for export to the US per annum.

One hectolitre is the equivalent of 176 pints.

Moving production closer to the market will allow it be produced more competitively and consumers will benefit from a fresher product, the document added.

This decision was confirmed yesterday - exactly a week after Guinness said its review of its two Dundalk plants will result in the closure of the packing outlet where 190 are employed and a "radical transformation" of the brewery where it wants to cut approximately 90 jobs, leaving a staff of 60.

These jobs are dependent on the plant's production capability being increased to two million hectolitres by May 2001 and involve it operating on a 24-hour, seven-days-a-week basis.

However the document from Mr Peeters also says that if demand for product does not materialise, "we will reschedule shift coverage to reduce from a seven-day to a five-day operation.

"This will require approximately 44 roles, assuming contract opportunities have been realised. If we are unable to transform successfully within the time scale, the site will close".

Workers in the brewery are already fearful about how viable the plant will be with just 60 employees and yesterday raised concerns about the potential impact of the transfer of the Harp contract.

At the moment around 1.6 million hectolitres are produced in the Dundalk plant.

The transfer to a brewery in Canada will see that drop to 1.2 million.

Guinness spokesman, Mr Pat Barry, said yesterday: "The cost factor at which we could sell Harp in the States did not make it competitive.

"The price can be made more competitive by doing it this way".

Because of the price at which it is sold in the US to cover costs, including shipping from Ireland, it has been removed from some bars, further reducing its sales in an already extremely competitive market.

Mr Barry added that the Dundalk plant is currently operating under-capacity at approximately 1.5 million hectolitres per annum.