(Via Motherboard)

Yup, Nutella, the goo of unholy mixing of chocolate + nuts. At least, that is what an OECD trade policy paper highlights in a report on global value chains (GVC).

What is a global value chain?

“A value chain identifies the full range of activities that firms undertake to bring a product or a service from its conception to its end use by final consumers. Technological progress, cost, access to resources and markets and trade policy reforms have facilitated the geographical fragmentation of production processes across the globe according to the comparative advantage of the locations. This international fragmentation of production is a powerful source of increased efficiency and firm competitiveness. Today, more than half of world manufactured imports are intermediate goods (primary goods, parts and components, and semi-finished products), and more than 70% of world services imports are intermediate services.” (5)

How does Nutella fit into this?

“About 250 000 tons of Nutella are produced each year. Nutella® is representative of agrifood value chains. The food processing company Ferrero International SA headquartered in Italy and has nine factories producing Nutella®: five are located in Europe, one in Russia, one in North America, two in South America and one in Australia. Some inputs are locally supplied, for example the packaging or some of the ingredients, like skimmed milk. There are however ingredients that are globally supplied: hazelnuts come from Turkey, palm oil from Malaysia, cocoa from Nigeria, sugar from Brazil (but also from Europe) and the vanilla flavour from France. Nutella is then sold in 75 countries through sales offices.” (17)

This illustrated visually in the map below, also from the policy paper:



“The location of production is close to final markets where Nutella® is in high demand Europe, North America, South America and Oceania). There is no factory in Asia so far because the product is less popular (another Ferrero delicacy, the “rocher” is however more popular in Asia and manufactured in India). In agri-food business value chains, there are more developing and emerging economies involved, as can be seen with countries in Latin America and Africa in the case of Nutella®.” (18)

Actually, the main reason why Africa is even involved is because of the need for cocoa. This seems to fit the competitive advantage of that has been so popular in institutions of global governance — countries focusing on what they are really good at, their niche on the world market rather than import-substitution, which was more popular with newly independent regimes after decolonization.

Of course, such destructuring of production chains was made possible by development in technologies of transportation and containerization as well. Then, cultural globalization fosters the development of a taste for this.

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