Nestlé to build $37m cereal factory in Malaysia

Cereal Partners Worldwide (CPW), a joint venture between Nestlé and General Mills, will invest CHF 35 million (~AU $37 million) over two years in the construction of a new breakfast cereals factory in Malaysia.

The factory, which is due to begin production in 2012, will manufacture Nestlé breakfast cereal brands Koko Krunch, Honey Stars, Cookie Crisp, Koko Krunch Duo and Milo, for consumers in Malaysia, and for export to Singapore, Indonesia and Thailand.

Located in Chembong, Negeri Sembilan, the 6,500 metre square factory will enable the local production of Nestlé breakfast cereals for the first time in Malaysia, which are currently being imported.

Nestlé’s Executive Vice President and Zone Director for Asia, Frits van Dijk, said the company selected Malaysia to build its cereal facility based on the readily available local ingredients.

“Having a factory in Negeri Sembilan also means that we are producing the breakfast cereals right here in Malaysia, which is one of the most important markets in the region,” van Dijk said. “This will create hundreds of direct and indirect jobs, so benefiting Malaysian society.”

The new factory, which will source up to 80 per cent of its raw materials from local suppliers, will be built based on policies for environmental sustainability adopted by both partners in the CPW venture, and in full compliance with environmental legislation.

The new factory will be the third CPW cereals production centre in Asia, as Nestlé breakfast products in the region continue to increase in popularity.

The two other factories are in Lipa, in the Philippines, and in Tianjin, China. They will maintain existing production capacities for their respective domestic markets, as well as for export to other Asian countries.

The new factory will be built next to an existing Nestlé factory in Chembong, which produces popular confectionery brands including Kit Kat.

Image: Cookie Crisp: one of five best-selling Nestlé cereal brands to be manufactured at the new Cereal Partners Worldwide factory in Malaysia, Source: nestle.com