Brazil: Kraft Heinz Bets on Local Production

In Brazil, local production should soon allow Kraft Heinz to free itself from imports.

Brazil is one of ten global tomato processing industries with an annual production exceeding one million tons, and its level of activity places it sixth or seventh in the world in this sector. The Brazilian industrial sector is now almost exclusively focused on the production of tomato paste, a portion of which is then further processed into tomato sauces and ketchup.

However, as we have observed in articles published in recent years on the Tomato News website (see the linked references at the end of the article), this production is not sufficient to fully meet domestic demand; imports supplement domestic processing, particularly in the sauce and paste sectors.

The quantities mobilized are relatively small compared to those of other countries with equivalent consumption, which seems to indicate that Brazil is progressing towards self-sufficiency in industrial tomato products. In recent years, annual consumption estimates are around 1.7 million tonnes of fresh tomato equivalent; this figure should be compared with the processed quantities, close to 1.6 million tonnes, and with the Brazilian trade balance for tomato pastes and sauces. Between 2022/2023 and 2024/2025, Brazil was a net importer of pastes, for an average volume of 25,600 tonnes of finished products; and a net exporter of barely significant quantities, estimated at 127 tonnes of sauces and ketchup.

It is in this context that Kraft Heinz Brasil announced that all ketchup sold in the country under the Kraft Heinz brand since last year has been produced exclusively from tomatoes harvested in Brazil. “ A few years ago, we didn’t have the production capacity we needed, so we had to import tomato paste from California. The great news is that our harvests are now improving both in quantity and quality,” said Ariel Grunkraut, CEO of Kraft Heinz Brazil since November 2024.

Self-sufficiency, and then what?

Now self-sufficient in Brazil in terms of tomato paste production, Kraft Heinz has not ruled out launching exports of this type of product. Currently, the company purchases Californian paste to meet the needs of its production sites in Mexico, Costa Rica, and Venezuela (see additional information at the end of the article).

For now, however, growing demand in Brazil does not yet allow for a shift towards exports: “ Our ambition is that in three to five years we’ll be able to export to Latin America…and take advantage of Mercosur, and supply Hispanic markets,” said Mr. Grunkraut, one of whose main missions is to accelerate the company’s growth.

The challenge therefore mainly concerns the agricultural production of tomatoes for processing into tomato pastes. The raw material used by Kraft Heinz to produce its ketchup comes partly from processing tomato crops in Cristalina, in the state of Goiás, but these areas are only one of the company’s sources of supply: Kraft Heinz works with thirteen producers in this state, where its factories are also based, in the city of Nerópolis. Each year, the company processes several hundred thousand tons from crops with a yield of up to 130 tons per hectare.

For Matheus Pimentel, Director of Purchasing and Agriculture at Kraft Heinz, using local production offers clear logistical and environmental advantages, while also reducing the company’s exposure to external factors: “ Our reaction speed is critical, because when we depend on maritime shipping from California, any global transport or logistics crisis can disrupt supply and leave us short on Heinz paste.” This local approach also limits the risk associated with fluctuations in exchange rates and customs duties, which can impact the value of imported products.

Over the last three fiscal years, Brazil’s trade balance for tomato products has shown a deficit of around USD 55 million, of which more than USD 32 million (59%) was spent on supplies of tomato paste, mainly from Italy, China, and Chile and Egypt.

Upstream Agriculture

Being less dependent on the international context and engaging with a global company also has advantages for upstream agriculture. According to a producer who devotes 350 hectares—a significant area—to growing processing tomatoes under contract with Kraft Heinz, “ With table tomatoes, you’re at the mercy of market swings—sometimes prices soar, sometimes they crash. With industrial tomatoes, profitability isn’t always as high, but it’s much more stable,” explains the operations manager.

In July, all of Kraft Heinz’s Brazilian suppliers obtained international Farm Sustainability Assessment (FSA) certification, a first for the company’s global operations. Lucas Paschoal, Kraft Heinz’s Director of Agriculture, emphasizes that the company now evaluates growers through its Excellence Program, launched in 2024. Quality, sustainable practices, productivity, and business performance are among the criteria for assessment; the most successful growers receive marketing incentives, priority access to new technologies, and are involved in the company’s crop planning.

In the Brazilian market, several varieties are grown exclusively for industrial use. Kraft Heinz relies on proprietary seeds developed over ninety years ago. “ We have our own genetics that were developed in California in 1934. So, 100% of Heinz seeds are created in California and then exported worldwide, including to Brazil,” said Paschoal.

Regarding the recent announcement of the company’s split into two businesses (see related references at the end of the article), Taste Elevation, dedicated to sauces and condiments, and Groceries North America for coffee, cheese, and other products, Mr. Grunkraut explained that the restructuring should have little impact on the Brazilian operations, which will remain entirely under the responsibility of Taste Elevation.

This country is one of five considered strategic for Kraft Heinz, primarily due to its growth potential. Double-digit growth is expected in Brazil this year. “ We just completed two acquisitions in under five years, and we’re still integrating them into our portfolio. The challenge for the next decade is to drive growth organically,” said Mr. Grunkraut.

Some additional data

Kraft Heinz established itself in Brazil in 2013 by acquiring the local agri-food company Quero, thus gaining access to processing networks and tomato producers. Over the past five years, the group has also acquired Hemmer and BR Spices, investing 1 billion Brazilian reals (approximately USD 185 million) in the construction and modernization of plants in Nerópolis, Blumenau (Santa Catarina), and Jandira (São Paulo).

Evolution and composition of the Brazilian trade balance for tomato sauces and ketchup.

Evolution of US exports of tomato paste to Mexico, Costa Rica, Venezuela, and Brazil from 2015/2016 to 2024/2025.

Sources: valorinternational.globo.com, TDM, WPTC