At the same time, the US-based vegetable processor has shelved plans to use rail to transport potatoes from its defunct Scottsdale plant to its upgraded Ulverstone processing headquarters.
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"The Devonport rebuild is not official or approved but we are studying it," Simplot Australia managing director Terry O'Brien said yesterday as he showcased the recent $35 million upgrade of the company's Ulverstone plant.
"The demand for frozen vegetables has moved to mixed whole-meal products and we need to build up our processing capabilities to cater for that."
The existing vegetable plant at Spreyton would be dismantled and then rebuilt.
The vegetables needed to produce a range that will satisfy modern tastes are already grown in Tasmania.
But Mr O'Brien said the rebuild would see Simplot want less of some vegetables and more of others.
Tasmania's farms have the scope to increase capacity of less traditional vegetable crops, according to TFGA vegetable council chairman Ian Young, but the price would have to be right for farmers to change.
"Any new development is welcome but crops like broccoli and cauliflower are labour-intensive. If Simplot is prepared to pay us properly to change, then it will be no drama," Mr Young said.
A decision to upgrade the Ulverstone potato processing plant was made last year - at the same time the vegetable giant decided to close its potato plant at Scottsdale.
The investment added a second french fry line and boosted production capacity by 35 per cent and created 21 jobs. About 110 Simplot employees lost their jobs when the North-East factory was shut.
Ulverstone is now Simplot's only Australian potato processing facility.
Its French fries feed KFC and McDonald's outlets around Australia and 650 permanent and casual workers are employed there.
Five hundred Tasmanian potato growers are contracted to the US- based company and produce is brought to Ulverstone by truck from the North-East, Fingal Valley, Derwent Valley and the Midlands.
Simplot was looking at signing a deal with TasRail for potatoes to be bought to Ulverstone by rail rather than road.
"We looked at this closely but timing and quality issues in terms of delivery and rail infrastructure needed ruled it out," a Simplot spokeswoman said.
Mr O'Brien said the flow-on business generated by the Ulverstone factory generated nine per cent of Tasmania's gross domestic product, an annual roll-up wage bill of $30 million and $100 m in grower payments.
