Nestlé in society Creating Shared Value and meeting our commitments 2015

Nestlé in society:
Creating Shared Value
Nutrition, health
and wellness
Rural development
Water
Environmental
sustainability
Human rights
and compliance
Our
people
Indirect economic impacts G4-DMA, Investment G4-DMA
Increased coffee farmer income
through yield improvement
Coffee farming income is directly related to yield, quality and
production costs. In Thailand, robusta coffee trees are usually
over 25 years old and originate from non-selected varieties,
with average green coffee production of 875 kg/ha. Around
30% of farmers’ income is spent on fertiliser. Therefore, the
key to increasing revenue and ensuring sustainable coffee
farming lies in optimising productivity and cost control.
Nestlé Thailand is addressing these issues by providing
intensive training to farmers on yield improvement, soil fertility
management and cost reduction. The programme comprises
three main elements: rejuvenation of coffee trees, tree
propagation and soil fertility management.
Tree rehabilitation uses a technique called stumping. This
enables fresh growth and more productive branches, and
promotes the development of new stems. Propagation is based
on grafting, using suitable local material. Grafted coffee trees
produce stems that come into production sooner than new
plantings, minimising income losses.
The soil fertility management programme involves
correcting the pH through lime application, increasing soil
organic matter by adding compost from agricultural waste (e.g.
coffee husk) and creating bulk-blending formula fertiliser.
Thirty demonstration plots have been set up, and 2862
farmers have been trained on yield improvement and production
cost management. Farmers are reporting yield increases up to
1.5 tonnes/ha in two years, with production costs per hectare
almost halved by adopting the improvement techniques.
future of the world’s food supply is in trouble. Offering more
opportunities for young farmers and for farming business
development is, thus, of the utmost importance to ensure the
future supply of agricultural raw materials.
The objective of agripreneurship
Agripreneurship is an approach we have recently formalised
to accelerate the development of farmers to nurture their
farming skills, competencies and business management.
While this approach has already informed existing training
schemes, we now intend to be more systematic in rolling it
out. Agripreneurship particularly addresses farmers who are
operating in our Farmer Connect and direct sourcing
operations. It helps foster sustainable intensification of
agriculture, making best use of good agricultural practices and
excellence in farming operations. Agripreneurship contributes
to developing competitive and sustainable growth-oriented
farming business models.
Agripreneurship applies to both large- and small-scale
farmers – what is more important is having an entrepreneurial
mindset and attitude, and a proven record in farm
management. Our aim is to create agripreneurs, ambitious
farmers running profitable businesses and complying with
Nestlé’s quality, safety and responsible sourcing standards.
Training and developing
young farmers
Agripreneurship at Nestlé
Food production needs to increase by almost 70% by 2050 to
meet the food calorie requirements of the growing global
population. While there is a trend away from intensive
agricultural production in developed economies, which usually
goes along with a reduction in productivity, emerging economies
are intensifying their production systems to achieve higher yields.
But high pesticide and fertiliser use in input-intensive production
systems bear the risk of residues in harvested raw materials and
the contamination of waterways and the environment. At the
same time, food safety and quality norms are becoming more
stringent, requiring farmers to acquire more knowledge on the
application of good agricultural practices and appropriate
technologies to meet the requirements of the food industry.
While farmers in developed countries generally have access
to training, farmers in most emerging countries do not. The
majority don’t become farmers by choice, but by default.
Farming is labour intensive and tends to provide little
economic and social reward. Young people from rural areas
are migrating to urban centres in search of jobs that provide a
better income with higher perceived social status. The farming
population is ageing fast, and not enough skilled young people
are replacing them. This is a real problem – if capable young
people can’t be convinced to work in agriculture, then the
Globally, young people are turning away from farming as a
career, often seeing it as providing little economic or social
reward. Offering more training for young farmers, and
providing them with micro-finance and access to markets,
would do much to help safeguard the future of agriculture.
One successful scheme, which won the 2012 Nestlé CSV
Prize, is an agricultural school for teenagers in Paraguay run by
the non-profit organisation Fundación Paraguaya. The initiative
sets up micro-businesses like gardening, hotel services,
beekeeping and egg production on school premises, providing
students with free training on top of the normal academic
curriculum. The training involves theory and hands-on work,
ensuring students have the chance to practise new skills. In
addition to promoting agricultural knowledge, the school also
teaches entrepreneurial skills.
Another solution is training institutes that offer schoolleavers
a professional training and academic qualification in
farming. In China, Nestlé has opened an institute in partnership
with the local government, universities and agricultural
industries to encourage modern dairy farming practices and
help farmers meet the country’s milk demand in a sustainable
manner. The institute trains farmers on animal nutrition, animal
health and welfare, milking hygiene, animal feeding and
environmental protection. Laboratories and demonstration
farms enable farm managers and workers to attend training
sessions to improve farm management skills, learn the latest
technology and gain practical business experience. Around
700 students will be trained annually, and Nestlé hopes to
assist many young Chinese become successful farmers.
Nestlé in society – Creating Shared Value and meeting our commitments 2015 102