Barry Callebaut, the world’s largest manufacturer of cocoa and chocolate products, and Kraft Foods, Inc., the world’s second largest food company and a global leader in confectionery, have signed a long-term global master product agreement. Under the terms of the agreement, the parties expect Barry Callebaut to deliver the majority of Kraft Foods cocoa products and industrial chocolate requirements around the world.

The agreement, which also includes some of the Cadbury liquid chocolate deliveries under the current outsourcing agreement, is expected to more than double Barry Callebaut’s existing business with Kraft Foods. The parties agreed not to disclose any further terms of the agreement.

As a result of this agreement, Barry Callebaut will increase its production capacities primarily in the United States, Canada, Côte d’Ivoire and Malaysia as well as in Europe, and invest approximately $65 million over the next two years. The additional volumes will be built up gradually over a period of three years, starting immediately.

“This long-term global supply agreement with Kraft Foods ranks amongst the largest strategic deals our company has ever signed,” says Juergen Steinemann, Barry Callebaut’s ceo. “It means that we have succeeded in firmly establishing ourselves as a leading supplier for cocoa and chocolate products to the international food industry. We are excited about this partnership between two leading companies in their field, which is evidence of the ongoing outsourcing and partnership trend in the chocolate industry.”