Nestle to invest another P5B in Philippines next year

Posted at 10/12/2012 10:24 PM | Updated as of 10/13/2012 11:33 AM

MANILA, Philippines - Nestle's locally produced coffee creamer has started rolling off the line in its new factory in Batangas.

The Swiss food giant said it's spending another P5-billion to expand Philippine operations next year.

"There will be a second and maybe a third phase. The nature of that expansion will depend very much on how market develops," said John Miller, chief executive officer of Nestle Philippines.

"The way consumer taste develops will determine what we need in terms of manufacturing facilities.  What we're continuously doing is investing in our existing plants.  A lot of it is expanding capacity," he added.

Nestle spent P5 billion for its fifth and newest plant in Tanauan, Batangas.

The factory will make coffee creamer Coffeemate, which Nestle previously imported from Malaysia, Thailand, and Mexico.

It also takes some production load off its Cagayan de Oro plant, which makes Bear Brand and other nestle milk brands.

The Tanauan plant has a capacity of 60,000 metric tons or 2 million sachets of Coffeemate per hour.

Can Filipinos consume all that?

Miller estimates a Filipino drinks about 150 cups of coffee a year, which is 3 times lower than the average 450 cups consumed by a Londoner.

Nestle believes locally produced Coffeemate will encourage more Filipinos to drink coffee.

"Having Coffeemate produced locally would allow us to make sure that the coffee creaming is to the local taste palate. So we launched new flavors like creamy caramel for people who want caramelly taste when they cream it," said Nestle executive vice-president Nandu Nandkishore.
   
But caramel-tasting creamer is not even as sweet as the new jobs -- direct and indirect -- that the new plant will generate at a time when the global slowdown and the high cost of doing business in the Philippines are forcing shutdowns and downsizing here and abroad.