New investment presents a cool solution in Nicaragua
How a modernized storage facility is helping Cargill’s meat business grow with the country
February 01, 2016
Which came first, the increasing demand for chicken in Nicaragua or the growth of the nation’s economy in general? Either way, the two measures are keeping pace with one another, with 4 to 6 percent annual growth expected to continue for the next decade.
Cargill Meats Central America, which supplies about 65 percent of Nicaragua’s chicken market, has addressed this trend with a major investment. A new 68,000-square-foot refrigerated distribution center, inaugurated in December 2015, is currently Cargill’s largest investment project in Central America.
“The investment will help Cargill remain competitive in this market and solidify our business interests for years to come,” said Xavier Vargas Montealegre, Cargill's business leader for Central America.
The first phase of construction is now complete. The next phase, which includes the expansion and modernization of a processing plant, will continue for the next 12 months.
The investment is part of the nearly $50 million master plan to support the growth of the poultry industry and provide for the increasing demand for chicken and sausage in Nicaragua. It also helps mark the 50th anniversary of Cargill’s leading “Tip Top” brand in Nicaragua.
The refrigerated distribution center, with three storage rooms for frozen meats, fresh poultry and fresh deli products, will replace two outdated warehouses that were used to store frozen and refrigerated chicken.
The former facilities also simply lacked room for growth. In Nicaragua, alternative space for cold storage was consistently hard to find. During the peak season, the business had to rely on refrigerated container rentals for storage.
By increasing racked storage capacity to 7,000 pounds, the new facility presents several solutions that will, in turn, increase efficiencies in production and distribution logistics. It will provide a single place for storage and centralized inventory, which is expected to reduce distribution costs by $0.02/pound. The newly constructed cold storage facility will also meet the requirements of international standards.
All of this adds up to a cool solution that’s good for both Cargill’s customers and Nicaragua’s consumers.