Kraft Foods Inc said it would invest more than $100 million into its Russian coffee plant until 2015 to double production and meet growing demand for the beverage in the fast-growing market. The move comes a week after Nestle, the world's biggest food group, completed an extension of its coffee plant in Russia's southern Krasnodar region, which now has become its biggest soluble coffee factory in Europe.
Coffee consumption in Russia, traditionally a tea-drinking nation, has been on the rise over the past decade on the back of an explosion of coffee shops in Russia's cities, including Starbucks and Whitbread's Costa Coffee chains - and growing disposable incomes. Market research group Euromonitor expects the Russian coffee market to rise by 5 percent annually in volume terms at least until 2016.
Kraft, maker of Jacobs and Maxwell House coffee brands, said the plant would boost coffee production to 16,900 tonnes in 2013 and to 23,000 tonnes by 2015, compared with the current output of 10,500 tonnes a year. Since 2000, the company has invested more than $150 million in the factory located in the Leningrad region in Russia's north-west. Kraft was the second-biggest coffee maker in Russia in 2010 with a 19.4 percent share, lagging behind Nestle, which had 27.8 percent, according to Euromonitor.
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