Overview of Spain's Dairy Industry
Spain plays a crucial role in the global dairy sector, with an impressive annual milk production of approximately 7 million tonnes, supported by about 800,000 dairy cows. This robust production capacity underscores the industry's focus on quality and innovation, evident in the advanced dairy farming practices utilized across the country.
Dairy Processing and Products
The Spanish dairy processing industry handles over 6 million tonnes of milk annually, producing key products such as 320,000 tonnes of cheese and 100,000 tonnes of milk powder and whey. Leading companies like Capsa Food, Innolact, Lactalis Iberia, Danone España, and Central Lechera Asturiana are instrumental in driving the sector's growth.
Export and Import Dynamics
Spain is actively involved in international dairy trade, exporting approximately 400,000 tonnes and importing around 300,000 tonnes of dairy products each year. This highlights Spain's strategic significance in the global dairy market.
Key Market Events
Recent industry developments include an anticipated 0.4% increase in milk deliveries by 2024. Notable events include Capsa Food's acquisition of a 40% stake in Innolact and Danone's transition of yogurt production to Romania. Lactalis is exploring sustainable packaging solutions, while Galicia is projected to produce 41.6% of Spain's total milk output by 2024.
Industry Challenges
The Spanish dairy sector faces several challenges, including a sharp decline in the number of dairy farms from 145,000 in 1992 to just 9,500 by 2024. Contributing factors include generational changes, inadequate rural support, high production costs, adverse weather conditions, and the impact of the bluetongue virus, leading to a 2% reduction in milk production.
International Expansion and Sustainability
Amul's partnership with COVAP signifies significant international expansion into Spain. More Holstein Farm in Valencia, a Danone supplier, has reduced its carbon footprint by 26% since 2018, demonstrating a strong commitment to sustainability.
Regulatory and Support Measures
Spain's regulatory framework includes fixed-price contracts to prevent unfair trading practices. Cantabria has introduced subsidies for local dairy farmers, focusing on terrestrial-based production by 2025. Meanwhile, Nestlé is appealing a €6.8 million fine related to a milk price-fixing cartel case.
Regional Insights
In the Valencian Community, a decline in sheep farms has impacted traditional cheese production. Galicia faces rising costs and decreasing farm profitability, while Castilla y León, the second-largest milk producer, contributed 382 million kilograms of milk compared to Galicia's 1,298 million kilograms.
Product Diversification
Danone is expanding into the infant nutrition market with its Blédina brand. The Spanish food industry is negotiating access to the US market amid potential 30% tariffs on European products.
Economic and Social Impact
In May 2025, the average price of cow's milk in Galicia was 48.8 cents per liter, below the national average of 50.1 cents per liter. Rising costs across Europe are affecting profitability, with 359 farm closures in Galicia in 2024 and another 92 closures between January and April 2025.
Special Focus
Established in Barcelona in 1919, Danone remains a key player in Spain's dairy industry. Cheese expert Clara Diéz emphasizes the potential of matured cheeses for lactose-intolerant consumers and the importance of traditional cheeses in Spain.
Conclusion
The dairy industry in Cantabria is at a critical juncture due to low profitability, generational changes, and excessive bureaucracy. Despite these challenges, the Spanish market remains diverse, with leading brands like Central Lechera Asturiana and Pascual committed to tradition and innovation.
Market Trends
The Spanish dairy market continues to experience a decline in both volume and value for producers. As of June 2025, milk deliveries and prices have been on a downward trend, with a 1.6% decrease in deliveries compared to the previous year, reaching 616,864 tonnes. The average price of raw milk in Spain dropped to €0.496 per liter, below the EU average of €0.529 per liter. However, cow milk prices in Spain are showing signs of recovery due to decreased production.
Health and Safety Concerns
Spanish health authorities have issued an urgent recall of certain cheese products due to contamination with Listeria monocytogenes. The Spanish Agency for Food Safety and Nutrition (AESAN) is coordinating with European health authorities to ensure the immediate withdrawal of affected products.
Laboratory and Quality Assurance
Spain hosts one of Super Foods FZCO's laboratories, which conducts sensory, stability, and compliance testing to ensure product quality and alignment with international standards.
Spanish Cheese Sector
The Spanish cheese sector faces challenges in sustainability, innovation, and adapting to market demands. Opportunities exist for product and process innovation, continuous quality improvement, and strengthening "Brand Spain" internationally. A new investment in Castro aims to enhance the rural economy and expand dairy offerings in Galicia. The new plant in the industrial area of Castro de Rei by Daily Food Spain is expected to be operational by 2026, focusing on cream and processed cheese production.
Sheep Milk Sector
The sheep milk sector is experiencing declines in regional production and price drops. In July 2025, the average price of 'standard' sheep milk in Spain was €1.198 per liter, reflecting a 15.34% decline compared to July 2024. National quality pricing fell to €10.55 per hectogram, decreasing by 15.26% year-on-year. Sheep milk production also receded, with 46.1 million liters milked, marking a 7.16% decrease compared to the previous year.
Milestones
Danone celebrates the 30th anniversary of its iconic probiotic drink, Actimel, in Spain. José Sáez takes on the role of president of Spain's liquid milk association, focusing on enhancing competitiveness and ensuring the sector's future sustainability.
Genetic Advancements
Galicia's leadership in dairy genetics is highlighted by the genotyping program by CONAFE, which has propelled four cows from Lugo into Spain's top ten, establishing Galicia as a key player in dairy genetics.
Investments
Lactalis has invested €8.86 million in its plants in Villarrobledo and Marchamalo, Spain, generating 889 direct jobs and involving the collection of more than 26 million liters of milk from 83 municipalities.
Innovation and Sustainability
Danone has transformed its Valencian plant into an internationally connected innovation hub, emphasizing sustainability and operating with 100% renewable energy. Galicia leads in production with 41% of the total national output. In July, dairy farmers in Galicia were paid 48.3 cents per liter for raw milk, which is below the national average. Galicia has produced over 1.81 million tons compared to Spain's total of 4.39 million tons. In the case of organic milk, Galicia also plays a significant role. The average price in July was 60 cents per liter, slightly below the Spanish average of 61.3 cents. Of the 3,548 tons produced under organic conditions nationwide, 2,458 are sourced from Galician farms.
Health and Disease Management
Spain records its first outbreak of bovine contagious nodular dermatitis, prompting urgent sanitary measures. The presence of the disease was confirmed following the emergence of two outbreaks in cattle farms in Gerona province.
Capsa Food increased its price by 2.06 €, supported by new bonuses related to animal welfare. In Spain, the average price reached 50.47 €/100 kg, positioning it competitively within the European context.
Modified: 2025/10/12