Nestlé Shifts Cappuccino Mix Production to South Africa Amid Rising Demand

Nestlé SA is relocating its cappuccino mix production from South Korea to Babelegi Industrial Park, South Africa, in response to the burgeoning demand for the popular coffee product. As the fastest-growing segment in the South African coffee market, cappuccino mixes have seen significant growth during the Covid-19 pandemic, prompting Nestlé to invest R79 million in the expansion of its South African manufacturing plant.

Nestlé East and Southern African Region (ESAR) announced the expansion of the manufacturing plant, which already produces popular products like Maggi two-minute noodles and Cremora coffee creamer.

According to Carl Khoury, the business executive officer for coffee and beverages at Nestlé ESAR, the company is a market leader in this coffee segment. He highlighted the convenience and great taste that cappuccino mixes bring to coffee lovers in South Africa. With the ability to be prepared anywhere, these mixes have seen significant growth during Covid-19 and are expected to continue their upward trend.

To support this growth, Nestlé has invested R79 million in the factory. The highly automated manufacturing plant, imported machinery from Europe, and advanced processes allow for producing 1,200 sachets of cappuccino per minute and 2,500 tons of mixes per year. Most of these products are for the local market, with the remaining being exported to other parts of the continent.

Nestlé plans to locally source over 40% of raw materials for the new processing plant in South Africa to streamline the supply chain, reduce costs, and minimize foreign exchange exposure. Similar efforts are being made in Nigeria and other African countries. Additionally, the company aims to expand its coffee bean production in countries like Kenya and Angola, currently relying on imports from Vietnam and Brazil.

By focusing on local sourcing, Nestlé increases efficiency, reduces environmental impact, boosts employment, and shortens the time taken to reach consumers. Overall, this expansion represents Nestlé's commitment to meeting the demands of the South African market while simultaneously investing in sustainability and growth across the African continent.

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