Mondelez International will invest $350m in a cookie plant that will become the world’s largest, according to the President of Mexico.
At an event held in Nuevo Leon on Monday Mexican President Enrique Peña Nieto and Mondelez officials announced a new plant would be constructed at the Interpuerto Technology Park in Monterrey.
Mexico a strategic market, says Mondelez
Gustavo Abelenda Divola, vice president of Mondelez International Latin America, said: "Mexico is a strategic market of great importance to our company, and this project is a clear example of this, as it will bolster our presence in the country." [Translated].
The plant is expected to open in mid-2014 and will create hundreds of new jobs.
The biscuit market in Mexico, which includes cookies and crackers, grew in retail value by 9.2% to MXN 33bn ($2.5bn), according to Mintel.
The market is expected to register a further 9.9% compound annual growth rate (CAGR) up until 2016 to reach MXN 51.6bn ($3.9bn)
Mintel data shows that PepsiCo accounts for 51.1 % of the market followed by domestic giant Group Bimbo on 35.6%. Mondelez is third place, but is someway off the top two with just 3.3% of the market, just ahead of Nutrexpa.
Mondelez biscuit strategy
Mondelez’s global biscuit division is led by Lorna Davis who said at the September 2012 Barclays Back to School Conference that BRIC markets were the focus for the division – which is not the case for the chocolate and gum & candy divisions.
The company made no mention of Mexico, but Davis identified Singapore and Columbia as large ‘Next Wave’ markets with strong growth potential.
At the conference, Mondelez claimed it was the biscuit market leader in Latin America.
Confectioners in Mexican invest mode
Many confectioners have made investments in Mexico over the past few years.
Earlier this week, Barry Callebaut opened a $48m chocolate factory in Toulca to supply bakery giant Grupo Bimbo.
Italian confectioner Ferrero is constructing a $190m production plant in Guanauato - its first in the country.
Hershey is also trying to reinvigorate cocoa growing in Mexico through a $2.8m initiative.
CORRECTION: This article previsouly said Mondelez's investment in the Mexican cookie plant was MXN 600m ($45.9m). The investment is in fact $350m.