Nestlé’s Coffee Production Factory, Veracruz, Mexico

In December 2018, Nestlé announced its plan to build a new coffee production factory in the municipality of Veracruz, Mexico.

The facility will be developed in three stages. A total of $154m will be invested in the first phase, which will generate 1,500 jobs during construction and 2,750 direct and indirect jobs on completion.

The investment will contribute to the economic growth of Mexico’s south-east region.

Nestlé’s new coffee production factory details

The new coffee production facility will process 20,000t of green coffee beans a year using state-of-the-art equipment.

Around $96m of raw materials a year will be sourced from coffee producers in Veracruz, which will be used to produce coffee brands such as Nespresso, Nescafé Gold, Taster’s Choice, Dolce Gusto, Cappuccino, Coffee-mate and Reserva Mexicana.

An advanced operational management system will be installed to integrate the plant’s operations and improve operational efficiency.

Sustainable features of Nestlé’s new coffee processing plant

Nestlé’s new coffee processing factory will be installed using sustainable environmental practices and technologies to reduce the environmental impact of the site, including water and energy consumption.

The production process will be powered by renewable electricity, while the coffee bagasse ash waste generated at the factory will be recovered to produce energy.

The process water will also be treated and recirculated to reduce operating costs and increase efficiency.

In addition, the plant will meet the requirements of global food safety and quality standards.

Nescafé Plan initiative

Nescafé Plan is a global initiative aimed at improving Nescafé’s coffee supply chain. The company claimed that it sourced 54% of its coffee supply responsibly in 2017 and intends to source up to 90,000t of Sustainable Agriculture Network (SAN) compliant green coffee by 2020.

Nestlé also aims to distribute 220 million high-yield, disease-resistant coffee plantlets to farmers in Mexico, the Philippines, Indonesia and Thailand by 2020. The company will also build new propagation centres in Mexico and other coffee-producing countries.

Nestlé partnered with the National Institute of Forestry, Farming and Fishing Research (INIFAP) and AGROMOD on various coffee bean projects in Mexico, under the Nescafé Plan.

It has developed a presence in the coffee zones and mountainous regions of Mexico through its Nescafé Plan initiative.

Marketing commentary on Nestle

Headquartered in Switzerland, Nestlé sells food and beverage products to 189 countries globally. It owns approximately 2,000 brands, operates 413 factories and employs 32,000 people in 85 countries.

The company entered the Mexican market in 1930, establishing its first factory in the country by 1935. It opened a soluble coffee factory in Mexico’s capital Toluca in 2013. It sources 68,500t of green coffee in the country.

Nestlé purchased 340,000 69kg bags of green coffee in Mexico between 2017 and 2018, and provided technical support to approximately 5,000 coffee producers through the Nescafé Plan initiative. With coffee as a strong growth driver, Nestlé plans to make further investments in coffee operations to grow its coffee business.

The company reported an annual revenue of CHF89.8bn ($91bn) in 2017.