The company's first steps toward closing the plant mean that efforts by city representatives, local business leaders and union representatives to dissuade privately held Brach's from moving the production away from Chicago have failed.

"I don't think anyone will be surprised, as the reasons for our decision are beyond the control of the local community," Kotecki said in an interview. "Domestic sugar prices are too high, the facilities are outdated, and the industry is rapidly consolidating. As a result of all this, there is no opportunity for us to be successful here."

Under terms of a severance program negotiated with Brach's by the Teamsters Union, which represents many workers at the plant, employees will receive the equivalent of one week's salary for every year they were employed by the company. Medical support will be provided for six months after the date of dismissal. The company also said it would provide outplacement services.

"The program is better than in similar cases," said Julio Lara, principal officer with the Teamsters Local Union 738. "But there are many older workers who will have difficulties to find new jobs." According to the Teamsters, the average worker has spent 27 years at Brach's plants.

"We don't understand why the company wants to leave Chicago," said Lara, asserting that Brach's makes a hefty profit on its Chicago operation. As a privately held operation, Brach's policy is not to publish figures on earnings and revenues, a spokeswoman said.

The company produces and sells hundreds of varieties of chocolates and hard candies, including StarBrite Mints, Milk Maid Caramels and Maple Nut Goodies. Its Chicago factory is a 2.2 million-square foot facility at Cicero Avenue and Kinzie Street.

Kotecki said Brach's will keep its administrative headquarters in the Chicago area, but he said Brach's executives aren't ready to discuss potential uses of the Cicero Avenue facility.

Under terms of a contract signed in spring, Argentina's largest candymaker, Arcor, will make about 30 percent of Brach's candies. "Canada and Mexico are options we are considering, but we have not signed any other agreements yet," added Kotecki. The company will continue to run facilities in Minnesota and Tennessee, but in the future, Kotecki said, the major part of Brach's production will be sourced out to other companies.

The Swiss billionaire Klaus Jacobs, owner of a European candy and chocolate empire, bought Brach's from American Home Products in 1987. By then, the candy producer was the Chicago's sixth-largest manufacturer with 4,000 workers.

Bob Boutin, president of Skokie-based Knechtel Laboratories, a confectionery consultant, says conditions in Chicago are increasingly difficult for candy companies, given the high costs for labor and sugar. Federal legislation protects U.S. sugar producers by keeping sugar prices artificially high through price supports and import quotas.

Under these circumstances, analysts are skeptical about the outlook for the industry in Chicago, still a capital of candy production. In the last decade, city officials say, the number of candy-related jobs dropped to 9,000 from 17,000. "Being realistic, we will see more and more companies moving to the southern U.S. or leaving the country completely," said Boutin.