Nestlé invests in production and sustainable agriculture in China

Nestlé is investing a further RMB 400 million ($58.5 million) into China, in an effort to boost sustainable agriculture and production in the country.

The capital will be used to fund dairy practices, local grain cultivation and increasing production capacity of its cereal products.

The news comes a few months after Nestlé announced that it will build its first dedicated plant-based production facility, as part of a $103.7 million investment into the country. 

Nestlé says it will use part of the investment to fund a new Nestlé Grain Competence Center (GCC) – Nestlé’s first such facility worldwide – as it aims to promote the development of local grain cultivation in Heilongjiang, with an initial focus on organic grains.

Part of the investment will also be used to complete an expansion and upgrade of the Nestlé Dairy Farming Institute (DFI), which was established in 2014 to help modernise Chinese dairy farming practices. According to the company, the investment will strengthen its role in dairy farming training and its position as a sustainable source of high-quality local milk, especially for Nestlé’s A2 milk products.

In addition, Nestlé is conducting a series of emission reduction projects at the DFI’s own dairy farm which it says will develop and showcase best practices, aiming to explore opportunities for ‘carbon-neutral’ fresh milk. The projects forms part of Nestlé’s aim to reduce greenhouse gas emissions in its supply chain.

The second part of the investment will focus on strengthening the company’s production capacity in Shuangcheng, in the province of Heilongjiang. Nestlé says this will be completed in two phases over the next five years. This will include expanding the production capacity for its Gerber infant cereals by more than 50%, as well as launching two new product categories; infant cereal-based snacks and adult functional foods.

In order to make its Shuangcheng facilities more sustainable and efficient, Nestlé announced that it will introduce new energy-saving programmes and replace some equipment with state-of-the-art technologies.