July 15 (Bloomberg) -- Nespresso, the biggest maker of single-serve coffee, will introduce its sustainability program to Africa as it forms a board with the heads of Fairtrade International and Rainforest Alliance plus actor George Clooney.
The Nestle SA division plans to start the program in Ethiopia and Kenya as well as try to help reestablish a coffee industry in South Sudan, Nespresso said in a statement today.
“We always need more coffee,” especially sustainable coffee, Nespresso Chief Executive Officer Jean-Marc Duvoisin said at a press conference in Lausanne, Switzerland.
Nestle is highlighting Nespresso’s environmental and labor standards of production as competition in single-serve coffee intensifies. Rival capsules that work in Nespresso machines probably squeezed the brand’s first-quarter sales growth to 8 percent, the slowest pace in its history, Jon Cox, an analyst at Kepler Cheuvreux in Zurich, has estimated.
“This is a great, big company working very hard to help people at the bottom,” Clooney, who already appears in Nespresso advertisements, said at the press conference. “It’s smart business.”
Nespresso has surpassed an objective of obtaining 80 percent of its coffee through the company’s AAA sustainability program, which started 10 years ago, Duvoisin said. Nespresso buys coffee from 56,000 farmers under the program and pays them a 30 percent to 40 percent premium to New York market prices. Colombia, Costa Rica, Guatemala, India and Mexico are among countries where farmers take part in the AAA projects, according to Nespresso’s website.
“They benefit and we benefit,” Duvoisin said, adding that Nespresso relies on access to the top 1 percent to 2 percent of the best quality coffee.
Nespresso will introduce capsules with African blends next year, and it may help produce rare Sudanese varieties, Duvoisin said. The company isn’t raising prices to consumers, he said.
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