Nestlé: capsules are annoying, but they only account for 10% of emissions – 01/04/2024 – Café na Prensa
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Being able to track the coffee production chain is one of the biggest challenges in the sector today.
Recently, the European Union approved a law that, among other things, prohibits the import of certain products – including coffee – from deforested areas. The standard, which begins to be applied in January 2025, requires evidence that there has in fact been no deforestation on that property in recent years.
The approval of the law caused a rush by exporters for traceability, as shown by the Coffee in the Press.
The domestic industry, however, still lacks sophisticated mechanisms in this area. The main manufacturers in Brazil still do not have such strict policies for monitoring the production chain.
Responsible for brands such as Nescafé, Nespresso and Dolce Gusto, Nestlé established a traceability policy a few years ago and claims that, today, 100% of the coffee it purchases is traceable.
Thanks largely to this initiative, the company was mentioned as one of the leaders in ESG aspects in the Coffee Brew Index study, including environmental issues. At the same time, it is the main company in the capsule coffee market, which produces a huge amount of waste.
Asked about the apparent contradiction, Taissara Martins, head of ESG for coffees and beverages from Nestlé Brasil, states that the capsules bother the consumer, because of the waste they are left with at the end of preparation, but that the packaging accounts for only 10% of the carbon emissions from the entire process.
In the interview given to Coffee in the PressMartins also talks about other traceability bottlenecks and how to remain competitive while paying more for sustainable raw materials, among other topics.
See the main excerpts below.
Large companies in the sector do not own coffee farms. They actually buy and conduct the industrial processing, roasting and packaging process. And these coffees are often purchased from intermediaries, without any direct contact with farmers. But, generally, the major social and environmental problems in the coffee production chain are concentrated precisely in cultivation. In this scenario, how does the coffee industry see the ability to track the production chain?
Taissara Martins – There is a tendency for people to think that traceability means you know where it comes from and it ends there. But we believe in deeper traceability, which, in addition to me knowing where it comes from, I work with the person who is supplying it to me. That’s the point of complete traceability.
You read correctly: not only from Nestlé, but the standard for coffee in the Brazilian market really is purchase through traders [intermediários, que compram de agricultores e revendem para empresas].
But buy from traderin our view, does not minimize its responsibility for the chain.
So our decision making was: I buy coffee from a traderbut I need to have an umbrella of direct contact with my suppliers.
So today we know 100% of our producers and we go to the farms at least once a year.
We have been working to make certification a standard in the category, so that everyone can grow in this direction. But today, based on our numbers – and these are our internal sources –, it is estimated that only 15% of Brazilian coffee is certified.
When you say certified, you mean a certification that allows complete traceability, is that it?
And that’s it. Because certification guarantees me farm data. So even if I buy through traderhe gives me this list of producers.
And then I was commenting. Of the 15% of certified coffee, or that we can guarantee that has this clear traceability, half of that is bought by Nestlé. I believe the other half is exported.
Industry practice is to buy a blend of producers. So maybe you’ll get one trader who sets up a blend and sells to companies. There is a lot of talk about quality criteria and very little about who is behind this coffee.
Is Brazilian legislation aligned with the current socio-environmental needs of the sector? What could be improved to force companies to follow stricter standards?
We would love to see the need for certification become legislation. That would put the entire industry elsewhere. But perhaps this is the simplest answer or the answer in which we outsource responsibility to the public sector. I think there is an important role for large buyers here. And I think asking for certification is the first step, and it should be the fundamental one.
In addition to certification, we have to couple other things as well. So it worries me when I see practically the entire sector that is not even on base zero, which would be certification.
So I think there is a shared responsibility. And not just from buyers, but from suppliers too. The coffee that passes in the hands of traders It’s very big. There are a lot of people involved in this purchase and sale with the producer.
Large companies in the sector have traceability mechanisms, but these actions normally focus on the brand’s gourmet lines. But the large volume of production is found in the cheapest lines. So how to reconcile fair trade and sustainability and at the same time be competitive?
Yes, that is the challenge. It’s simpler to add traceability to premium. But Nescafé, when we look at the core of Nescafé, which is instant coffee, which is the coffee that is in the basic basket, that is where most of our pride comes in. Because that’s where we achieved this perfect marriage between certification, traceability, producer bonuses and without losing competitiveness. Of course, if you get there on the shelf, there will be differences. And we believe that probably a large part of this difference that will occur between a standard Nescafé soluble product and the others is probably this. The cost we pay for raw materials is a little more expensive. But for us this is non-negotiable. So what I have to do is work on the rest of my chain, guarantee much more productive efficiency, guarantee a lean team, guarantee the help that we ask for from our employees. traders…
So, being very pragmatic in our response, today we still cannot be as competitive in coffee mainstream. Part of this is linked to the responsibility we have in the chain. But the difference, to be very honest, is very small. Even the consumer doesn’t feel it.
Nestlé Global was cited as a key leader in ESG aspects in the last Coffee Brew Index, including environmental issues. At the same time, it is the main company in the capsule coffee market, which produces enormous waste. Doesn’t it seem a little contradictory? How did you manage to achieve this despite having such a large portfolio in the capsule market?
I think the question is great. Because we raise discussions that need to be raised. The first of these is the perception that people have regarding packaging. Packaging is a theme, because it is what the consumer is left with, in the end, after consuming, especially the coffee capsule. He’s got that rubbish in his hands. And that bothers you.
But, talking about the concept, when we look at sustainability, we have to look at the entire process. When we look at the main sustainability indicator today, which is the carbon footprint, we see that 70% of Nestlé’s carbon footprint – and I don’t think it will be different from the others – is in the production of raw materials.
As much as we think packaging is the big offender, in reality, for example, with Nestlé, it’s 10% of my footprint. And when we look at coffee capsules, it’s the same thing. When I look at the carbon footprint of coffee capsules, packaging is the third item. I first have coffee production; then I have the energy used by the machines; and then I have the capsules.
So the efforts we make – and where most of our energy and investment resides – are where most of the footprint is. And that’s why it’s justified. This decision by Nestlé, way back, about certified coffee, deforestation-free coffee, regenerative agriculture, all of this today puts us in this position.
Because in the end, if I solved 100% of my packaging, if all my capsules could be like NEO capsules, which are made of paper and disappear in six months, if I made all this effort, I would only solve 10% of my problem.
What are Nestlé’s main goals and commitments in the area of sustainability?
When we became a 100% certified cafe, in 2019, we saw that we were ready to move forward one more stepwhich was the step of regenerative agriculture.
So we added this piece to the regenerative component, and that’s where our commitments come in. We want to have 30% regenerative coffee by 2025, that is, we have one year to reach this goal.
How many percent are they today?
Today we are at 18% regenerative agriculture.
Nestlé Global set a target of 20%. Here in Brazil, given the fact that Brazil is one of the main coffee suppliers for Nestlé and the largest coffee producer in the world, we raised that bar a little and decided to talk about 30%. So we have 30% until 2025, 50% until 2030 and then we want, in some way, considering our objective as a company netzero By 2050, these farms must be major CO2 capturers.
How do you see the coffee industry regarding environmental and social issues in the coming years?
I think we are already ahead of many other countries because Brazil has two very important criteria. The first is high productivity. The Brazilian producer is very efficient. And, when you are efficient, you need less area, less fertilizer, less pesticides… And the second point is that coffee production in Brazil is very established. We see less production expansion and more coffee in the same places producing more. So more technology, more resistant varieties… it’s different perhaps from other crops, where we still see the need for expansion. And when we see this agricultural expansion, we enter into these complicated conversations linked to deforestation.
So I believe not only that Brazil will continue to be the world’s coffee supplier, but it will also be the supplier of sustainable coffee.
Sustainability is fundamental, but consumers still look for price. Don’t you think that companies that don’t have good socio-environmental practices will continue to have space in the market, as long as they can have lower prices?
I think we cannot minimize the Brazilian consumer’s awareness of this topic, even if it is not on the same level as, for example, the European consumer. And we know that, especially coffee, which is a staple item, consumed by all Brazilians every day, it would be a little naive for us to say that in the next five years, if coffee does not come from sustainable sources, the Brazilian consumers will say they don’t want it. I don’t think that will happen. But it is also a fact that the new generations are very different from what we have experienced until now.
I don’t see a risk in the sense of: ‘tomorrow these companies will be out of the market?’ They won’t be. But more and more they are falling behind.
TAISSARA MARTINS, 35
Graduated in agricultural engineering from Unesp, has an executive MBA from Insper and has been at Nestlé Brasil for over 14 years. Currently, she holds the position of head of ESG for the company’s coffees and beverages.
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