Spain's Dairy Industry Overview
Spain is a notable force in the global dairy market, with an annual milk production of around 7 million tonnes supported by approximately 800,000 dairy cows. The industry emphasizes quality and innovation, ensuring its competitive edge internationally.
Dairy Processing and Products
The Spanish dairy processing industry is substantial, processing over 6 million tonnes of milk annually. This results in significant production of cheese, amounting to 320,000 tonnes, along with 100,000 tonnes of milk powder and whey. Key players in this sector include Capsa Food, Innolact, Lactalis Iberia, Danone España, and Central Lechera Asturiana.
Export and Import Dynamics
Spain actively engages in international dairy trade, exporting about 400,000 tonnes of dairy products each year while importing approximately 300,000 tonnes, highlighting its integral role in the global dairy market.
Key Market Events
Looking ahead, a 0.4% increase in milk deliveries is anticipated by 2024. Significant corporate movements include Capsa Food's acquisition of a 40% stake in Innolact and Danone's strategic production shift to Romania. Lactalis is exploring sustainable packaging solutions. By 2024, Galicia is expected to account for 41.6% of Spain's total milk production.
Industry Challenges
The sector faces several challenges, including a decline in the number of dairy farms from 145,000 in 1992 to an expected 9,500 by 2024, attributed to generational changes, high production costs, adverse weather conditions, and the impact of the bluetongue virus, which has led to a 2% reduction in milk output.
International Expansion and Sustainability
Amul's partnership with COVAP represents ongoing international expansion efforts. Sustainability initiatives are prominent, with More Holstein Farm in Valencia achieving a 26% reduction in its carbon footprint since 2018.
Regulatory and Support Measures
Spain's regulatory framework includes fixed-price contracts to prevent unfair trading practices. Cantabria offers subsidies emphasizing terrestrial-based production by 2025. Meanwhile, Nestlé is appealing a €6.8 million fine related to a milk price-fixing cartel case.
Regional Insights
The Valencian Community is experiencing a decline in sheep farms, impacting traditional cheese production. Galicia faces rising costs and decreasing profitability, while Castilla y León, the second-largest 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, negotiating for access to the US market despite potential 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. Rising costs led to the closure of 359 farms in Galicia in 2024, with 92 more closures between January and April 2025.
Special Focus
Danone, founded in Barcelona in 1919, maintains a significant presence in Spain's dairy sector. Cheese expert Clara Diéz highlights the potential for matured cheeses suitable for lactose-intolerant consumers and the importance of traditional cheeses.
Market Trends
The Spanish dairy market is witnessing a decline in volume and value for producers. By June 2025, milk deliveries had decreased by 1.6% from the previous year, and the average raw milk price fell to €0.496 per liter, below the EU average.
Health and Safety Concerns
Spanish health authorities have recalled certain cheese products due to Listeria monocytogenes contamination, with the Spanish Agency for Food Safety and Nutrition (AESAN) coordinating with European health authorities for product withdrawal.
Laboratory and Quality Assurance
Spain hosts a Super Foods FZCO laboratory conducting sensory, stability, and compliance testing to ensure product quality and alignment with international standards.
Spanish Cheese Sector
The cheese sector in Spain faces challenges related to sustainability and innovation, with opportunities for product and process innovation, quality improvement, and enhancing "Brand Spain" globally.
Sheep Milk Sector
The sheep milk sector is experiencing declines in both production and prices. In July 2025, the average price of 'standard' sheep milk was €1.198 per liter, marking a 15.34% decline from July 2024, with production down by 7.16%.
Milestones
Danone celebrates 30 years of its probiotic drink Actimel in Spain. José Sáez has assumed the presidency of Spain's liquid milk association, aiming to enhance competitiveness and sustainability in the sector.
Genetic Advancements
Galicia leads in dairy genetics, with a CONAFE genotyping program placing four cows from Lugo among Spain's top ten, underscoring Galicia's significant role in dairy genetics.
Investments
Lactalis has invested €8.86 million in its Spanish plants, creating 889 jobs and collecting over 26 million liters of milk from 83 municipalities.
Innovation and Sustainability
Danone's Valencian plant has transformed into an innovation hub, emphasizing sustainability and the use of renewable energy. Galicia leads with 41% of national production, contributing significantly to organic milk production.
Health and Disease Management
Spain's first outbreak of bovine contagious nodular dermatitis has prompted urgent sanitary measures. Capsa Food has increased prices, supported by new animal welfare bonuses.
Regulatory Issues
The Spanish Supreme Court halted a mega dairy farm project in Noviercas, Soria, highlighting environmental compliance challenges for large agricultural projects. FeNIL, representing the Spanish dairy industry, has secured a preliminary agreement for salary increases and reduced working hours until 2028.
Bluetongue Virus Outbreak
The bluetongue virus has been recorded in six new provinces since October 30, 2025, affecting 24 out of 50 provinces since April 1, 2025. AESAN has issued an alert due to a Listeria monocytogenes outbreak, heightening scrutiny over cheese and other ready-to-eat dairy products.
Spain's Dairy Industry Strengthens with the Formation of CoRural
The formation of CoRural, a merger between Clun and Leche Celta, marks a significant development in Spain's dairy industry. Valued at €600 million and comprising 1,400 producers, CoRural represents a formidable force in the sector. The industry has also secured a new labor agreement for 2025-2028, which includes wage increases, reduced working hours, and enhanced benefits.
Product Innovations
Bioiberica and Lactalis have introduced a collagen-enriched milk in Spain. Puleva Vita Calcio Colágeno, a milk drink enriched with native type II collagen, sets a new standard for dairy products. A Spanish court has mandated Capsa, Puleva, and Danone to compensate farmers for anti-competitive practices, addressing the impacts of the milk cartel in Spain and aiming to rectify financial losses for farmers caused by collusion among major dairy companies.
Regional Focus: Galicia
Galicia, a key region in Spain, relies heavily on its agricultural sector for economic stability, with dairy farming representing a significant portion of the local economy. Spanish distributor Global Dairy Ventures, based in Barcelona, connects European producers of premium cheese and dairy products with retail and foodservice clients and has been acquired by Royal A-ware. Galician dairy farmers are facing significant reductions in milk supply contracts.
In Galicia, dairy farmers are encountering substantial reductions in the prices offered in milk supply contracts, with decreases ranging between 3 to 11 cents, affecting their overall income and broader sector negotiations. Arzúa-Ulloa cheese has become the leading variety exported from Spain, reflecting the country's commitment to promoting traditional dairy products.
Modified: 2026/02/11