Mondelez International has reduced the supply chain lead time for a key ingredient in its Cadbury chocolate bars by at least two months, following the opening of a new manufacturing facility in Malaysia. The $22 million plant, located in Shah Alam, began production on Friday to create chocolate crumb locally, replacing previous imports from Australia and South Africa.
Nitin Binnani, vice president of customer service and logistics for the AMEA region at Mondelez, stated that producing the ingredient on-site significantly shortens the supply chain. He noted that the move is expected to cut import and transportation costs while supporting projected volume growth across Southeast Asia.
The Shah Alam site serves as Mondelez’s only Cadbury manufacturing hub for Southeast Asia. According to Binnani, the facility produces more than 130 varieties of chocolate and outputs approximately 100 million bars annually.
This operational shift comes as cocoa prices have stabilized after a historic price surge over the previous two years, driven by unfavorable weather conditions and poor harvests that heavily impacted chocolate manufacturers. Southeast Asia remains a critical component of Mondelez’s global manufacturing network, with other facilities such as the Cikarang plant in Indonesia exporting to nearly 40 countries, including Australia and Japan, and Thailand acting as an export hub for gum and candy.
Additionally, Mondelez is currently exporting chocolate crumb from the new Malaysian facility to Pakistan to mitigate supply disruptions caused by interrupted shipping routes. The company, headquartered in Chicago and formerly known as Kraft Foods before its 2012 renaming, owns major snack brands including Oreo, Ritz, and Sour Patch Kids.
The expansion aligns with broader trends in the region, as U.S. agribusiness giant Cargill also recently expanded its specialty fats production in Port Klang, Malaysia, adding capacity for ingredients used in chocolate manufacturing.
Interesting that they’re already exporting to Pakistan too. Does this mean global prices might finally stabilize after that cocoa crisis?
Wait, so we’re getting Australian chocolate crumb from Malaysia now? The logistics flip is wild, but I guess cheaper import costs help.
Cutting two months off the supply chain is huge. Local production in Shah Alam makes total sense for Southeast Asian demand.