Nestlé invests 1.3 billion dollars in Brazil – where does the power come from?

Nestlé invests 1.3 billion dollars in Brazil – where does the power come from?

Nestlé has said it will increase its investments in Brazil to a total of 7 billion reais, equivalent to about $1.3 billion, by 2028. This amount is higher than the previous investment of 6.3 billion reais in the previous cycle. These investments will focus on key categories around the company's three core raw materials, further strengthening Brazil as a growth engine in Latin America. This reports Market screener.

Marcelo Melchior, CEO of Nestlé Brazil, highlights that the return on investment is in line with initial expectations. In Brazil, Nestlé will generate sales of about 4 billion Swiss francs ($4.90 billion) in 2024, making it the company's third-largest market worldwide. As part of the investment plan, the franchise model is also being considered as a new business area that could potentially be expanded internationally.

Investments in technology and production

By the end of 2025, Nestlé Brazil will invest over 6 billion reais in business growth, new technologies, expansion of production units, as well as portfolio transformation and sustainability programs. The plan is to build a new production facility for Nestlé Purina in the south of Brazil and to introduce a personalized production line in the existing factory in Caçapava, where the largest chocolate production in Latin America takes place. The company focuses primarily on the premiumization of chocolate and cookies with new production lines.

In 2024, a new KitKat line will be inaugurated at the Caçapava factory, with a total of six exclusive production lines planned by 2028. Nestlé Brazil is considered the largest buyer of certified Brazilian coffee and has switched all coffee purchased to sustainable and certified sources since 2019. This is in line with Nestlé's goal of promoting sustainability in production.

Sustainability and digital transformation

Investments in digital transformation and Industry 4.0 are intended to further increase efficiency and productivity. Nestlé Brazil is committed to ensuring that 100% of raw materials are traceable and 100% of the energy in production comes from renewable sources. In addition, initiatives are being undertaken to minimize water and energy consumption and reduce emissions in the manufacturing facility pilots.

Nestlé's comprehensive sustainability agenda also promotes capsule recycling and invests in regenerative agriculture. The construction of a second Purina factory in Vargeão (SC) is intended to increase pet food production and meet demand for wet food.

Nestlé has been operating in Brazil for over 100 years, employs more than 30,000 people and operates 20 production facilities and eight distribution centers. According to a study by Kantar Worldpanel, the company is present in 99% of Brazilian households, which underlines Nestlé's deep roots in the Brazilian market. This extensive expansion and commitment to Brazil confirms the country's role as a crucial market for Nestlé, as well Latin Press highlights.