The owner of Hovis is to close two bakeries and cut 900 jobs as part of plans to overhaul the struggling bread business.

The biggest impact will be felt in Birmingham, where 511 jobs are to be lost with the closure of a factory and distribution operation, reports The Guardian.

Hovis operations at Greenford, west London, will also shut with the loss of 196 jobs, while the company’s owner, Premier Foods, is preparing to close distribution sites at Plymouth and Mendlesham, Suffolk, resulting in the loss of 95 jobs in total.

The closures are subject to consultation with employees but are scheduled to take place during the course of 2013.

St Albans-based Premier, which also makes Mr Kipling cakes and Bisto gravy, has seen its Hovis division hit by intense competition in the bread market and a surge in wheat price inflation caused by poor weather.

And it is set to lose a £75m-a-year contract with a major grocery chain from the middle of next year after Premier was unable to agree a new deal on sufficiently attractive terms.

It is cutting 130 distribution routes and closing the supply centres to take into account the expected reduction in volumes.

The Premier chief executive, Michael Clarke, said: “We recognise the impact these actions will have for our employees at the sites affected.

“Decisions will not be taken lightly but they are necessary if we are to build a strong and successful future for the bread division and those who remain with our business.”