Tags: Ebola Outbreak | nestle | ebola | cocoa | earnings

Nestle on 'High Alert' in West Africa as Ebola Virus Spreads

Thursday, 16 Oct 2014 07:13 AM

Nestle SA is preparing for how to deal with the impact of the Ebola outbreak in West Africa as cocoa prices rise on concern it may spread to Ivory Coast, the source of about 40 percent of the commodity’s global supply.

Nestle is on “high alert,” even though it has no factories in the three countries most affected — Sierra Leone, Liberia and Guinea — Chief Executive Officer Paul Bulcke said at a press conference today in Vevey, Switzerland. Pulling employees out of the region isn’t necessary, he said.

Ivory Coast is on a list of 13 countries that the World Health Organization urged last week to be prepared for cases of the Ebola virus to ensure the epidemic doesn’t spread further. Earlier this week, Nestle pledged at least 100,000 Swiss francs ($106,000) to the International Federation of Red Cross and the Caritas charity to fight Ebola.

“The best to do in this situation is to be aware, and have the right priority, which is the safety of the people, and to continue with what you do there, which is creating stability,” Bulcke said. “If all of a sudden you close all factories in Africa, that would cause more panic. That’s not what you should do. Making sure the panic doesn’t spread is also a priority.”

‘Major Impact’

Nestle forecast a challenging fourth quarter, citing the Ebola outbreak as one of the reasons, along with political turmoil in Asia and higher raw-material prices. Cocoa futures have gained 16 percent in the past month.

Should the virus reach Ghana and Ivory Coast, it would have a “major impact,” Bulcke told Bloomberg Television’s Guy Johnson in an interview.

Nestle has taken actions to buffer cocoa prices that reach long into next year, the CEO also said. The company has about eight factories in its central and west African unit, which is based in Accra, Ghana.

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Nestle SA is preparing for how to deal with the impact of the Ebola outbreak in West Africa as cocoa prices rise on concern it may spread to Ivory Coast, the source of about 40 percent of the commodity's global supply.
nestle, ebola, cocoa, earnings
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2014-13-16
Thursday, 16 Oct 2014 07:13 AM
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