Overview of Spain's Dairy Industry
Spain stands as a significant contributor to the global dairy sector, producing approximately 7 million tonnes of milk each year. This production is supported by a robust cattle population of around 800,000 dairy cows, reflecting the country's commitment to quality and innovative practices in dairy farming.
Dairy Processing and Products
The Spanish dairy processing industry efficiently manages over 6 million tonnes of milk annually. Key products include 320,000 tonnes of cheese and 100,000 tonnes of milk powder and whey. Major companies such as Capsa Food, Innolact, Lactalis Iberia, Danone España, and Central Lechera Asturiana play pivotal roles in the sector's growth.
Export and Import Dynamics
Spain is actively engaged in the international dairy trade, exporting approximately 400,000 tonnes and importing around 300,000 tonnes of dairy products each year, highlighting its strategic importance in the global dairy market.
Key Market Events
Recent developments in the Spanish dairy industry include a projected 0.4% growth in milk deliveries by 2024. Capsa Food's acquisition of a 40% stake in Innolact marks a significant industry event. Notably, Danone is relocating yogurt production to Romania, and Lactalis is exploring sustainable packaging solutions. By 2024, Galicia is expected to produce 41.6% of Spain's total milk output.
Industry Challenges
The Spanish dairy industry faces significant challenges, such as a drastic reduction in the number of dairy farms from 145,000 in 1992 to just 9,500 in 2024. Factors contributing to this trend include generational changes, insufficient rural support, production costs often exceeding sale prices, 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 marks a notable international expansion into the Spanish market. Furthermore, More Holstein Farm in Valencia, a Danone supplier, has successfully reduced its carbon footprint by 26% since 2018, underscoring a commitment to sustainability.
Regulatory and Support Measures
Spain's regulatory framework includes fixed-price contracts to prevent unfair trading practices. Additionally, Cantabria has introduced subsidies to support local dairy farmers, with a focus 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 significant decline in sheep farms has affected traditional cheese production. Galicia faces rising costs and decreasing farm profitability, while Castilla y León, the second-largest milk producer, saw a decline in production, contributing 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 also 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/liter. Rising costs across Europe are impacting profitability, with 359 farms closing in Galicia in 2024 and another 92 closures between January and April 2025.
Special Focus
Founded in Barcelona in 1919, Danone plays a pivotal role in Spain's dairy industry. Cheese expert Clara Diéz highlights the potential of matured cheeses for lactose-intolerant consumers, emphasizing the importance of traditional cheeses in Spain.
Conclusion
The dairy industry in Cantabria is at a critical juncture with the loss of 400 dairy farms due to low profitability, generational shifts, 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. Castilla y León is reevaluating its ovine sector to enhance efficiency and profitability, generating over €500 million in economic value in 2022.
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 in Spain have been on a downward trend, with a 1.6% decrease in deliveries compared to the previous year, reaching 616,864 tons. 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 related to sustainability, innovation, and adapting to market demands. It has gained strong projection both in national and international markets. Opportunities include 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. Spain maintains a favorable trade balance in sheep milk with Italy as the main destination. The cheese sector has also expanded in both volume and value in the first half of the year.
The sheep milk sector faces 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.
Danone marks the 30th anniversary of its iconic probiotic drink in Spain. Danone has announced a significant milestone in Spain, celebrating 30 years since the introduction of its innovative probiotic drink, Actimel.
José Sáez becomes president of Spain's liquid milk association. Under Sáez's leadership, the focus will be on enhancing competitiveness and ensuring the sector's future sustainability.
Modified: 2025/09/22