Argentina's Dairy Industry: A Comprehensive Analysis

Milk Production and Livestock

As of 2023, Argentina boasts a population of approximately 1.6 million dairy cattle, contributing to an annual milk production of about 10.5 billion liters. This impressive production is a testament to the country's efficient dairy farming practices and favorable climatic conditions.

Milk Processing and Cheese Production

Argentina processes nearly 9 billion liters of milk each year, showcasing its substantial processing capacity. This is further reflected in the cheese production volume, which reaches approximately 500,000 metric tons annually, highlighting the nation's efficiency in transforming raw milk into high-quality dairy products.

Milk Powder and Whey Production

In addition to liquid milk and cheese, Argentina's dairy industry also produces around 150,000 metric tons of milk powder and whey annually. These products serve both domestic and international markets, demonstrating the sector's diverse offerings.

Key Enterprises

• La Serenísima (Mastellone Hermanos S.A.): A leading entity offering a wide range of dairy products.
• Saputo Inc.: A global dairy leader with significant operations in Argentina.
• Williner: Known for its specialization in cheese and other dairy offerings.

Dairy Farms

• Tambos La Unión: A significant dairy farm known for its extensive milk production.
• Estancia La Nueva: Another vital contributor to the national milk supply.

Exports and Imports

Argentina exports approximately 3.5 billion liters of milk annually, including products such as liquid milk, cheese, and milk powder. In contrast, given its substantial domestic production, the country's imports of dairy products remain relatively minimal.

Significant Events

• Saputo Inc. Board of Directors Election: Highlights ongoing strategic planning in Argentina's dairy sector.
• Decline in Dairy Consumption: The IDAA reports significant decreases in consumption, with 2024 potentially seeing historic lows.
• Saputo's Performance in Latin America: Generated about $1.5 billion in revenue from Latin America in 2023, despite economic challenges.
• Export Growth: A substantial 50% increase in dairy exports, strengthening its global market role.
• Legal and Market Shifts: Court ruling delaying Bunge's takeover of Vicentin reflects major changes impacting the sector.
• Challenges in 2024: Projected 7% decline in milk output due to weather and economic issues, with a 13% decrease in the first half compared to 2023.
• EU-Mercosur Trade Deal: A proposed linkage aims to enhance trade dynamics, with Argentina part of the negotiations.
• Production Recovery: Despite early declines, production has shown signs of recovery, although primary supply remains below 2023 levels.
• New Trade Agreement: The EU-Mercosur agreement, comprising Argentina, Brazil, Paraguay, and Uruguay, marks a historic achievement.
• Robust Harvests: Exceeded expectations in Argentina, reflecting positive agricultural conditions.
• Milk Prices: Reached historic highs in 2024, affecting sustainability concerns at $0.43 per liter.
• SanCor's Financial Situation: A prominent player facing financial challenges and labor conflicts.
• Market Dynamics: Economic challenges led to the closure of Dánica Dorada's factory, while Arla Foods Ingredients plans significant investment in Córdoba.

In summary, while Argentina continues to be a pivotal player in the global dairy market, current economic and climate challenges pose significant threats to the sustainability of dairy production and the livelihoods of many rural families. Argentina has suspended German imports due to a Foot-and-Mouth disease alert issued by the German Ministry of Agriculture.

Modified: 2025/01/16

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