February 20, 2018 / 2:01 PM / 3 months ago

Nestle set to launch first organic products in Brazil in coming weeks

SAO PAULO, Feb 20 (Reuters) - Nestle SA will launch its first organic food line in Brazil in the coming weeks, an executive told Reuters, as the world’s biggest food company makes a global push to capture growing interest in healthy and organic products.

Brazil executive manager for dairy and cereals, Carine Malher, said Nestle was planning to sell 1 million boxes of organic oatmeal and oat bran products in the country this year.

The company’s previously unannounced foray into Brazil’s organic foods segment is relatively minor in global terms. Each box of oatmeal and bran has a suggested price of 6.99 reais ($2.16), meaning the company projects slightly over $2 million of sales in the first year.

But the move fits into a more ambitious organics growth program by Nestle.

Malher said the company was actively developing a number of organic products in various “distinct units” in Brazil, while looking at acquisitions that could increase Nestle’s presence in the country’s still-modest organic foods market. The company should launch organic milk offerings in the first quarter of 2019 and Nestle also has an internal start-up in Brazil developing organic-based snacks, Mahler said.

“We have the oats, we have the organic milk, and we have more business units working on other products, so there is commitment to more organic offerings,” Mahler told Reuters.

Earlier in February, Nestle bought a majority stake in Terrafertil, an Ecuadorian company selling natural and organic plant-based foods. In the second half of 2017, Nestle purchased Canadian vitamin maker Atribum Innovations for $2.3 billion and announced deals for Sweet Earth vegetarian foods, Blue Bottle coffee, and Chameleon Cold-Brew coffee.

Mahler said Nestle already has a distribution contract for the new organic line with supermarket chain Pão de Açucar, owned by GPA, one of Brazil’s two major food retailers, and is planning to sell through many other retailers.

GPA, controlled by France’s Casino Guichard Perrachon SA , confirmed the contract and otherwise declined to comment. (Reporting by Gram Slattery; editing by Grant McCool)

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