Musson Group purchases Nestle Jamaica – Why High electricity costs make manufacturing difficult in Jamaica

Say it isn't so!!!

Nestle Jamaica, the Jamaican subsidiary of Swiss manufacturer Nestle that makes Betty Condensed Milk and Milo that all Jamaicans love is selling out to P.B. Scott-led Musson Group  as reported in the article “Musson to buy Nestle Jamaica – Sources”, published Wednesday November 18, 2015 by Neville Graham, The Jamaica Gleaner.

Reliable sources have come to light suggesting that the 75 years of continuous manufacturing since the 1940’s is coming to an end. Reduced demand and competition creating unprofitable margins are the culprit despite a health Jamaicans appetite for Nestle Products.

Apparently the Musson Group, which controls the Seprod Group and its subsidiary Serge Island Dairies, possibly would use Nestle production capabilities to expand the production of their own line.

After all, there would be no point producing Nestle products under the Seprod Group, as their own products are already doing well in the competitive processed foods market that's popular with shoppers at our local supermarkets.

Musson Group purchases Nestle Jamaica – Why High electricity costs make manufacturing difficult in Jamaica

This is quite a surprise to many, as I had imagined that as a multinational, the must have been doing quite well to have expanded their Supligen line to the tune of US$7.6 million in 2013.

But the high production costs, such as the importation of raw materials as well as electricity proved too much and hence selling their stake in Jamaica would allow them to recoup losses due to high production costs.

Despite a restricting of operations in 2013, Milo is no longer manufactured in Jamaica but in Asia. Other products such as Supligen and Betty Condensed Milk are manufactured in Trinidad & Tobago and the Dominican Republic, the electricity costs, wages and import duties are cheaper.

Possibly had they opted to build 1 MW Solar Plant as Wisynco is currently doing as noted in my blog article entitled “Wisynco Group 1 MW Solar Power Plant - British partnership with Padero Solar UK for conquest of Africa and India” they could have continued to find new higher Margin markets for products in the CARICOM Region.

I'm not really a fan of either company, but I like Nestle Condensed milk on my bread as a child and I used to buy Milo, albeit I usually end up eating it as opposed to making drinks with it. I also like Supligen as well as their milk, sugar-based and processed food products.

However, I've now gone the healthy eating route since 2013, eschewing imported canned and processed foods for Vegetables and Jamaicans foods from Downtown Kingston as noted in my blog article entitled “Jamaica's Basic Item Food Bill mostly from 1st World Countries - Buy Jamaican Build Jamaica made from Imported Raw Materials in containers that says Made in Jamaica”.

Hopefully, this acquisition by the Musson Group, if true will mean the rise of more natural alternatives using our own local fruits and vegetables grown here in Jamaica!