South American Real Estate News

Argentina: Nestle announced investments of $ 5.2 billion in the value-added liquid market

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At its Villa Nueva plant in Córdoba, Nestle will make high value-added liquid products from a location that previously only produced milk powder.

Nestlé, the world’s largest food and beverage company, inaugurated a new production line at its Villa Nueva plant in Córdoba in which they invested 480 AR million which is in the center of the dairy area in Argentina.

However, the local leader of powdered milk will not compete with the other big names in the industry, such as La Serenísima and Sancor, which will focus on other value-added products.

“This investment is part of a plan executed in the last four years for a total of $ 5.2 billion, which we are going to renew in 2019  for another four years for a similar amount, for all our products and the six plants we have at the same level. local, “Gian Carlo Aubry, CEO, and president of Nestlé Argentina, Uruguay and Paraguay told Infobae.

The company has six factories in total in the country and produces and sells locally brands such as Nescafé, KitKat, Nespresso, Eco de los Andes, Glacier and Purina, among others.

In 2018, it invoiced $ 17,700 million with dairy products representing 20% of the total. “This new line allows us to produce liquid versions (ready to eat) of value-added products with the UHT method, or ultra high temperature, a heat treatment that produces sterilized milk. We are almost 90 years now in Argentina and we are always positive about the development of the country, beyond the contexts. A year ago we produced Nesquik which is chocolate milk: our first investment in liquid milk. Nido milk is stored in Tetrapack units of 200 mils, “explained the Swiss executive.

The specific investment in Villa Nueva includes a sterilization plant with state-of-the-art technology, an adaptation for packaging and the renovation of the boilers, the cold system for the entire plant and an automated warehouse.

There is more and more concentration, with many small dairy farms  closing last year. In 2018 there was good export competitiveness. It is a difficult market, but dairy has a very good future in Argentina (Aubry)

A year ago, Nestlé produces liquid chocolate locally. Now it will make white milk added value products
One of Nestles local plants

Aubry said that the local market is around 10,000 million liters per year, and is a sector that grew in production by 8% last year.

In Argentina, the market for the sale of milk is traditionally liquid drinks, contrary to what happens in Brazil, for example, where most sales are powdered milk. Nestlé exports 80% of the products it produces in this category, to countries such as Brazil, Chile and several of Africa.

We are not going to compete in basic milk because there are already very strong brands with more chances of winning in this market. We go for added value and we are the first to have organic milk, for the local market and for export.

“There has been a general fall in consumption, but with marketing, launchings and various commercial activities we resisted and limited the fall in demand, and with the devaluation we were a bit more competitive and that favored our growth of milk powder exports into the region and others destinations, “said Aubry.

Source: Infoba ( translated )

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Post available in: English Español

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