Nestlé to build $154m coffee factory in Mexico. ‘Coffee is a strong growth driver

Nestlé is investing $154 million USD in a new coffee factory in Veracruz, Mexico: which will process 20,000 tons of locally sourced green coffee a year.

With the potential to process some 20,000 tons of green coffee per year while directly employing approximately 1,200 people, the facility could have lasting impacts throughout the region’s coffee sector. Whether those impacts are generally positive remains to be seen.

“Nestlé has identified coffee as a strong growth driver, and the coffee business has seen positive organic growth over the past years,” ​says the company. “We are making further investments to lead in the coffee business, creating value for its brands and making a difference for consumers.”​

Coffee stronghold​

Nestlé already sources 68,500 tons of green coffee in Mexico and has an existing coffee plant in Toluca, which is the largest Nescafé plant in the world.

In Veracruz, Nestlé buys $1,900 million pesos in raw materials from 10,000 producers every year. During the 2017-2018 harvest season, the company bought 340,000 bags of coffee, representing more than 35% of the grain it uses nationally.

Nestlé says the investment will help strengthen the Mexican countryside and accelerate growth of the Southeast region. The factory will initially employ 250 people and generate a further 2,500 indirect jobs; with the potential for this to rise to 1,200 direct jobs and 12,000 indirect jobs after three phases of expansion.

The plant will use 100% renewable electrical energy as well as using its coffee waste as a source of energy. Technologies to reduce water and energy consumption will be installed.

Nestlé already has 17 production facilities in Mexico, producing coffee, dairy products, bottled water, pet care and cooking aids.

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