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MILAN – Nestlé ‘s Nescafé plans to invest an additional half a billion reais (nearly $88.5 million) by 2028 to expand its production capacity in Brazil. This commitment is in addition to the one billion reais investment announced last year in Latin’s America largest economy. Brazil is the world’s third largest coffee consumer market after the European Union and the United States.
The announcement was made at a press event yesterday, Thursday 22 May. The fresh investments are focused on expanding the brand’s Montes Claros factory, located in the southeastern state of Minas Gerais, and increasing the footprint of its “Nestlé Professional” coffee machines, according to the company.
Valeria Pardal, Nestlé’s business executive officer for coffee beverages, declared herself optimistic about the growth opportunities in the sector.
“In the last five years, Nestle’s portioned coffee category has grown around 20%, so we are estimating this level of growth going forward,” Pardal was quoted as saying by Reuters.
Meanwhile, Brazil retail coffee sales fell 5.13% on-year in first four months of 2025 to 4.75 million 60-kilogram bags, the Brazilian Coffee Industry Association (ABIC) said on Thursday, citing higher prices.
The report also points out that the quarter started on a positive note, but in March there were the first signs of a downturn, with sales down 4.87% on the same period last year. April saw a further drop in sales of almost 16% compared to the same month in 2024.
This sharp decline comes as coffee prices have soared 80% over the past 12 months, marking the steepest increase in 30 years.
The price surge has affected all coffee categories, with soluble coffee experiencing the most dramatic increase at 85%. Gourmet varieties rose by 56%, while traditional coffees increased by 50%.
In a recent report, USDA sets its forecast for Brazil’s total domestic coffee consumption for MY 2025/26 (July-June) at 22.28 million coffee bags (21.3 million bags of roast/ground and 980,000 bags of soluble coffee). Inflation and high retail prices of coffee have continued to limit consumption growth in the country, despite the importance of the commodity for Brazilian consumers.
