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A loss of business with Aldi is believed to be behind Smales’ proposed closure of one of its Hull factories, with 95 jobs at risk.

Sources in the industry have told Business Live that the “major account” Smales said it had lost in a statement released by the fish firm is the German supermarket giant.

Smales has been processing fish and seafood in Hull since 1937, but announced on Monday afternoon it was planning to close the chilled seafood section of its business.

If that closure goes ahead, 95 jobs are expected to be lost, and Smales’ factory in Witty Street would shut its doors.

A source told Business Live: “The closure only affects their chilled food business and their frozen business continues positively.

“The chilled food market is always competitive and likely to be with a significant retailer.

“In that event business moves around regularly and is often subject to some sort of tender process. The business may well have been on tight margins anyway.

“I suspect that Smales have sensibly decided to focus on their good frozen business, particularly into fish & chip shops and smaller customers. That will be a very solid business.”