Nescafe

NESTLÉ’S NEWEST COFFEE PLANT IN MEXICO BOOSTS BRAZIL’S ROBUSTA

The Switzerland-based multinational food and beverage company Nestlé has recently opened a coffee processing plant in Veracruz, Mexico, which purportedly cost the company $340m. The Nescafé coffee factory will create 1,200 jobs and enable the company to process about 670,000 bags each year. This establishes Mexico as the company’s prominent global coffee processor, with the biggest instant coffee plant in the world.

The plant is a state-of-the-art facility, using the newest “equipment and green energies to reduce water and energy consumption.” It also employs “wastewater treatment systems to ensure 100% water recirculation, zero wastewater discharges and zero waste to landfills.”

The company didn’t disclose the amount of water used, but typically it’s a significant amount. Obtaining a license to operate such a large facility may require the installation of water treatment equipment to prevent an adverse impact, not just on the environment but on other residents and businesses.

Obtaining a license to operate such a large facility may require the installation of water treatment equipment

The processing facility is, says the company, not only environmentally friendly but also helpful in expanding the number of Mexican coffee producers that Nestlé supports and purchases from, bringing the total to around 100,000. The company also promised to source all of its coffee ethically by 2025, most of which is primarily intended for the American and Asian markets.

The company says, “through the Nescafé Plan, coffee growers from whom Nestlé sources have access to the advice of specialists. Nestlé’s global initiative supports the sustainable production and supply of green coffee, strengthens small producers’ production capacity, and promotes the economic and social development of their families and communities.”

The new plant doesn’t only show that Nestlé’s sales and demand for coffee continue to grow but also signals a change in the company’s sourcing strategy. It uses much of Vietnam’s robusta, but the country is too far away.

While Nestlé aims to source most of its coffee from Mexican farmers, robusta production is not enough for its needs. Mexico’s coffee crop is projected to produce 3.84 million bags, with only approximately 500,000 bags of robusta. Meanwhile, Brazil produces around 22.8 million bags of robusta and Vietnam with around 30.8 million bags.

The company will therefore process coffee imported from Brazil, a more affordable alternative than Vietnamese coffee and geographically closer as well. In recent years, “Mexico has sharply increased Brazilian coffee imports, from only 62,000 bags in 2017 to a record 920,000 bags in 2021, of which 85% were robusta beans, according to data from exporters group Cecafe.”

Mexico has sharply increased Brazilian coffee imports, from only 62,000 bags in 2017 to a record 920,000 bags in 2021, of which 85% were robusta beans, according to data from exporters group Cecafe.”

The US Department of Agriculture has forecast that Brazil’s robusta production will increase 5% this year, reaching “an all-time high… as Vietnam inches lower.” A StoneX Financial analyst, Fernando Maximiliano, said that Brazil will have this opportunity “by converting pastures into robusta crops,” which Vietnam is struggling with because of a lack of suitable land.

Author

  • Profil21

    organisation:

    Žiga Povše is a freelance writer, translator and a full-time coffee lover. After after visiting his girlfriend's family farm in Cerrado Mineiro, they opened an online store to sell Brazilian specialty coffee, and he remains an avid reader and a prolific writer.

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