Nestlé Will Manufacture in Mexico to Replace Imports
Mexico’s federal government has reached an agreement with Nestlé to replace imports of finished products and industrial inputs with domestic production. Under the arrangement, the company will have two years to begin manufacturing in Mexico product lines that currently enter the country from abroad. In return, the Economy Ministry will provide temporary facilities involving import quotas.
The agreement forms part of Plan México, a federal policy aimed at expanding domestic suppliers and agro-industrial value chains. It accompanies Nestlé’s investment programme, which includes an additional $1bn in spending during 2028-30. The company also committed a similar amount at the beginning of 2025 to expand processing plants in several Mexican states, according to the report by Periódico Zócalo.
The manufacturing programme covers Nestlé’s dairy products, infant-nutrition formulas and processed foods. The relevant facilities include operations in Jalisco, Querétaro, the State of Mexico and Veracruz. The report says that replacing imported ingredients with locally sourced raw materials would require stronger collection of raw milk meeting specified physicochemical and sanitary standards.
Milk delivered to dehydration and aseptic-packaging facilities would need to be kept at 4°C from farm-level storage tanks, according to the report. Expansion of domestic processing would also involve upgrades to homogenisation lines, membrane filtration and microbiological-control systems. These systems are used to check for pathogens and to support the shelf life of finished products.
The agreement addresses Mexico’s reliance on imports of skimmed milk powder and intermediate dairy products. The report says that large food companies have historically used tariff quotas to bring foreign surpluses into the country, while the new arrangement is intended to shift supply towards domestic sourcing and processing. The article also refers to processed substitutes made with vegetable fats and dehydrated whey that are sold through urban retail channels.
The investment programme is also linked in the report to production costs and infrastructure. Domestic manufacturing would reduce cross-border transport requirements, while possible cooperation with public economic-development and sustainable-energy schemes could support water-treatment plants using zero-discharge technology and high-efficiency electricity cogeneration. The report says that the increased need for fresh milk would affect dairy-producing areas in northern, western and central Mexico, including both technologically advanced and family-run farms.
To supply the additional milk required by industrial boilers and dryers, Nestlé would need medium-term supply arrangements with producers, the report says. It also describes payment schemes based on total solids and commercial terms at receiving facilities. The agreement was presented as part of the federal government’s effort to combine private investment with domestic manufacturing and agricultural supply.
