Case Studies, Environment & Climate Change

Nestlé: Saving water through improving factory processes

UN Global Compact Network Australia | March 22, 2017

Nestlé is a leading global food and beverages company. In the region, Nestlé Oceania employs more than 5,000 people, and operates 12 factories, 5 distribution centres and 20 offices, across Australia, New Zealand and the Pacific Islands. Over the last year, the region produced more than 280,000 tonnes of locally manufactured goods across 4,602 product lines. Nestlé seeks to embed sustainability – including environmental sustainability – in all its activities, brands and products.

One of Nestlé Oceania’s 2016 targets was to reduce its water usage rate (m3 /t) by 4.0%, and a majority of manufacturing sites within the region have achieved significant water reductions over recent years, including 2015, contributing to a 3.1% reduction.

Nestlé’s Smithtown factory is located on the mid-north coast of New South Wales, and has been producing Milo for more than 80 years. A key environmental initiative at the factory has been the reduction of water use by implementing a more efficient end-to-end malt extraction process.

Malt is the primary ingredient in Milo, delivering the drink’s iconic flavour. The traditional malt extraction process required large amounts of water: around one tonne of malted barley requires 4,000 litres of water. Malting barley is sent from the farmer to a third party to be steeped in water to initiate the germination process, which in turn activates enzyme production in the grain; this is then later used in the extraction process at the factory.

In 2014, Nestlé began a pilot project to investigate ways to reduce the large amounts of water used in the end-to-end malt extraction process. Nestlé Australia’s Director of Technical and Production, Mr Daniel Lagger, said it was a non-negotiable priority for the company to reduce its environmental footprint across the globe.

“It is a priority for us to consistently look for ways to minimise the impact of our operations on the environment and a key objective of this is to scrutinise the amount of water that is used across the entire value chain,” said Mr Lagger.

An outcome of the project has seen Nestlé’s product technology centre in Singapore develop a refined process that eliminates the need for steeping, yet still allows for the malt extract to be produced to the same quality and in the same quantities as the traditional process, while using significantly less water in the end-to-end process.

The new end-to-end extraction process has eliminated more than four steps in the chain and now sees the malting barley travel directly from the farm to its factory, saving more than 18 million litres of water a year through the entire process.

“Nestlé is committed to responsible stewardship of this precious resource and we seek continuous improvement in our withdrawal, use and treatment of water,” said Mr Lagger.

Find out more on Nestlé Oceania’s sustainable approach to water here:

2015 Creating Shared Value report

Nestlé Oceania’s approach to water

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UN Global Compact Network Australia