Nestle increases cocoa sourcing in Brazil amid supply shift

Nestle is broadening its cocoa sourcing operations in Brazil as the country's production experiences growth, according to CEO Philipp Navratil. Brazil was once a leading global cocoa supplier in the 1970s until a fungus called Witch’s Broom devastated most plantations. Recently, large-scale farms have resumed production using more resilient trees, which is boosting the outlook for future production growth.

CEO Navratil informed media representatives that Nestle has been working to enhance its cocoa supply chain following supply shocks that drove cocoa prices to record highs. Primarily, cocoa would be sourced from Western Africa, but Nestle has decided to explore Brazil as a promising alternative for high-quality cocoa. The company has established connections with hundreds of cocoa farms in Brazil to share knowledge on regenerative agriculture, aiming to boost quality and yields while reducing the use of conventional fertilizers due to rising farming input prices caused by the Middle East conflict.

As cocoa trees take up to five years to reach their full production potential, any significant change in the global supply chain will require time.