In response to the Thai government’s intervention policy in the coffee bean market, Nestlé Products has agreed to purchase domestic beans at or above the government specified price of 32 baht a kilogram. The local unit of Swiss food behemoth is the largest purchaser of coffee beans in the country and the agreement is expected to give the industry a much needed boost.

From January, Nestlé will purchase around 20,000 tons of locally produced coffee, but the increased price should not impact too heavily on the company’s cost revenues because the commodity previously sold at a higher price.

“Nestlé cooperates with the government as it can buy the coffee beans at prices higher than THB32/kg because the government doesn’t fix the selling price of instant coffee,” explained Phisit Setthawong, director-general of the Department of Internal Trade at the Commerce Ministry.

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THAILAND: Nestlé asked to buy coffee from local producers