Adecoagro weighs $100 million investment plan to expand its Argentine dairy business
Mariano Bosch, Adecoagro’s chief executive, outlined the investment plan in October, saying the company was considering several alternatives. These included expanding existing facilities and acquiring industrial assets. In a subsequent interview with Bichos de Campo, Alejandro López Moriena, the company’s sustainability director, reiterated its interest in opportunities across milk production and processing. Adecoagro is also examining projects in other businesses, including an increase in fertiliser production capacity at Profertil.
The company’s dairy operations are centred in southern Santa Fe, near Venado Tuerto, where it has approximately 14,500 cows in milk. The herds are managed under an intensive production system. According to López Moriena, output averages close to 39 litres per cow per day over the year, exceeding 40 litres at certain times. He said the business had reached its production-expansion objective and was now concentrating on improving the performance of its existing system.
Adecoagro’s integrated farming model includes growing feed for its cattle, managing the animals and generating energy from effluent, according to the company’s institutional information. Its processing operations use milk from its own farms as well as supplies purchased from other producers. The business extends from these agricultural activities through industrial processing to the sale of finished products under its own brands.
The company operates two dairy factories, in Morteros, Córdoba, and Chivilcoy, Buenos Aires. Both were acquired from SanCor while they were idle. Morteros mainly makes cheese and milk powder, with exports accounting for an important part of its business. Chivilcoy primarily serves the Argentine market, producing long-life milk, yoghurt, chocolate milk, cream, protein products and lactose-free alternatives. The two sites supply different product categories for domestic and overseas customers.
Adecoagro also brought Las Tres Niñas back to supermarket shelves as part of its move into consumer products. The brand had previously belonged to SanCor and had been absent from the market for several years. López Moriena said it had gained market share and helped strengthen integration between the different stages of the business. Alongside its branded consumer foods, Adecoagro sells ingredients for industrial customers.
López Moriena said Argentina’s natural conditions offered scope for the country to double or triple its primary milk production. In his assessment, achieving that potential would require the dairy industry to become more focused on supplying international markets. He also identified investment in processing as fundamental to turning additional milk volumes into products that could be sold.
