Nestlé expands cocoa purchases in Brazil after global supply shocks
Nestlé is buying more cocoa in Brazil and working with hundreds of farms to improve productivity, quality and supply resilience. Brazil currently produces roughly enough for domestic consumption, but the government expects output to double to about 400,000 metric tonnes within five years.
Nestlé broadens Brazilian sourcing
Nestlé has increased its cocoa purchases in Brazil, where production is recovering after decades of disruption, as the food and chocolate group seeks a more resilient supply chain. Chief Executive Philipp Navratil said the company is also helping Brazilian farmers adopt agricultural techniques that require less conventional fertilizer.
Navratil discussed the strategy in an interview with Reuters at Nestlé’s factory in Caçapava, São Paulo state. The site is the company’s largest KitKat production facility worldwide. According to the report carried by InfoMoney, Nestlé stepped up its supply-chain work after recent cocoa shortages pushed prices to record levels.
The company has established relationships with hundreds of Brazilian cocoa farms. It shares technical knowledge on regenerative agriculture with the aim of raising bean quality and farm productivity while reducing reliance on conventional fertilizer. Lower fertilizer use could also help contain growers’ costs after agricultural input prices increased amid the conflict in the Middle East.
Brazil rebuilds after witches’ broom
Brazil was among the world’s major cocoa suppliers during the 1970s, before the fungal disease known as witches’ broom devastated plantations. Several large farms have resumed production in recent years using more resistant trees, improving the prospects for further growth.
The recovery will nevertheless take time. Cocoa trees can require as long as five years to reach their full production potential, meaning new planting and farm-level improvements cannot quickly resolve tight global supplies. Nestlé’s approach therefore combines higher purchases in the present market with a longer-term effort to strengthen yields and resilience at origin.
Brazil still produces only roughly enough cocoa to cover its domestic consumption. The Brazilian government expects output to double over five years to about 400,000 metric tonnes. If achieved, that expansion would provide processors operating in Brazil with a larger local raw-material base, although the forecast does not imply an immediate export surplus.
Latin American output gains importance
Brazil’s plans form part of a broader increase in Latin American cocoa production. Ecuador has expanded its plantations for years and is approaching the output of Ghana, the world’s second-largest supplier. Ecuador now produces more than 600,000 metric tonnes of cocoa beans annually, according to the report.
Ivory Coast remains the leading producer at about 2 million tonnes. That scale underlines why developments in the largest West African origins continue to shape global availability and prices. However, growing supply from Ecuador and a sustained Brazilian recovery could give chocolate manufacturers additional sourcing options. For Nestlé and other processors, the practical benefit will depend on how quickly farms can lift yields, control disease and reduce input costs without compromising bean quality.
