The new production line will produce around 2,500 tons of coffee a year (equivalent to 130m capsules), using indigenous beans. While the site will serve the Vietnamese market, the majority (90%) will be exported to other Asian markets including Thailand, the Philippines, Malaysia, Singapore, Hong Kong, Taiwan and Indonesia.
Nestlé is focusing on increased coffee demand in Asia, and says the Dong Nai site is likely to increase production volume over the coming years. However, it will also have to address the lack of recycling options for its capsules - the capsules are not recyclable in Vietnam - as the company looks towards its global 2025 target of making all packaging reusable or recyclable.
Using indigenous coffee beans
In October 2015 Nestlé introduced the Nescafé Dolce Gusto coffee machine and its premium coffee capsules, saying the system ‘has been a huge hit with Vietnamese consumers’.
“The use of local coffee beans at the new production line will help satisfy domestic demand while enabling Vietnamese coffee lovers enjoy high quality at reasonable prices,” says Nestlé.
Nestlé is the leading coffee buyer in Vietnam with an annual purchase volume of 20-25% of total coffee production output in the nation.
“To raise the value of Vietnamese coffee beans further, Nestlé Vietnam implemented its Nescafe Plan in 2011,” says Nestle. “Through the project, Nestlé has helped improve the output and quality of coffee beans for export while increasing the production volume of coffee products such as the Nescafe Dolce Gusto capsules.”
Capsule waste: 2025 deadline
In some markets Dolce Gusto capsules can be recycled (such as through a partnership with TerraCycle in Australia).
However the single-use capsules are not recyclable in Vietnam.
Nestle announced its global ambition earlier this year to make 100% of its packaging recyclable or re-usable by 2025, with a vision for none of its packaging, including plastics, ends up in landfill or as litter.
Nestle told this publication that it is working closely with packaging suppliers although has not explained how the target may be reached in Vietnam nor clarified if there are recycling options in Dolce Gusto's export markets.
"Considerable progress has been made in recent years to ensure that a minimum adequate amount of packaging is used to pack products safely, and to ensure that packaging is recovered at the end of its useful life," said a spokesperson for Nestle Vietnam.
"Nevertheless, more still needs to be done. Due to the complexity of the capsules, they are not yet recyclable. However, we believe that there is an urgent need to minimize the impact of packaging on the environment and we are working very closely with all our packaging suppliers to ensure that the performance of our packaging is regularly improved and we need to take advantage of any technological advances.
"In April 2018, we announced our ambition to make 100% of our packaging recyclable or re-usable by 2025. Our vision is that none of its packaging, including plastics, ends up in landfill or as litter."