European food giant Nestlé is to close a dairy plant in Nicaragua due to “current global dynamics for efficient and productive operations”.
The Matagalpa plant in the north of the country produces the dairy products of Prolacsa, the Nestlé-owned local business.
Juan Gabriel Reyes, CEO of Nestlé Central America, told Just Food that the company is going to “gradually move” Prolacsa’s manufacturing to “other factories in Latin America”.
The local company’s portfolio includes cheese and cream brand Superior and dairy-based dessert label La Condesa.
Reyes told Just Food that it will maintain “commercial management” and sales of its products in the country “as well as the purchase of green coffee for [Nestlé’s] operations around the world”.
The chief executive said the Switzerland-headquartered consumer giant – behind brands such as KitKat chocolate and Maggi sauces – will continue to “purchase 13% of the country’s coffee”.
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The CEO said that the move was a “strategic decision at regional level” which aims to enable the business to “continue to offer our consumers affordable products of the highest quality”.
“This decision is exclusively due to the current global dynamics for efficient and productive operations and responds to the needs of our consumers,” he said.
Last September, Nestlé had struck a deal to buy a majority stake in Brazil-based chocolate business Grupo CRM.
Nestlé, which is buying the shares from private-equity firm Advent International, said the transaction would see it entering Brazil’s high-end chocolate market.