Lactalis has decided to shut a factory in Zambia, the country’s government has said.
The dairy group has cited “market dynamics”, Chipoka Mulenga, Zambia’s Minister of Commerce, Trade, and Industry, said.
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Lactalis’ decision has been reportedly locally, with the Daily Nation newspaper saying the French giant will export products into Zambia from South Africa.
Just Food has asked Lactalis for comment on multiple occasions.
In a post on Facebook, Zambia’s Ministry of Commerce, Trade and Industry said Mulenga said he met Lactalis management on 6 January to discuss the move.
“The decision taken has been motivated by business considerations over the past years, which have been informed by market dynamics, influenced by new players in the milk sector,” the ministry said.
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By GlobalData“The decision is, therefore, purely based on competitiveness, following new entrants in the sector. The company has elected to make internal re-organisation as part of its changing business model.
“Should Lactalis reconsider, its decision, the Government is ready to support them,” Mulenga said.
According to the Daily Nation, Lactalis will switch to an import model from April.
In Lactalis’ 2023 annual report, the privately-owned group said 16% of its €29.5bn revenues were generated from across Africa, Asia and the Pacific region. The majority, some 53%, are derived from Lactalis’ business in Europe.
In September, the group acquired the Cremora creamers business in South Africa from Nestlé.
The Cremora brand, present in South Africa for more than 77 years, was manufactured at Nestlé’s plants in Babelegi and Potchefstroom. Both of those sites were part of the deal.
Cremora is also produced in neighbouring Zimbabwe, at a site in the capital Harare, which will cease to manufacture the brand post the transaction with Lactalis.
