Argentina's Milk Production Growth Fuels Exports and Domestic Recovery

Recent reports indicate a significant increase in milk production in Argentina, leading to notable shifts in both export and domestic consumption patterns. As of the end of May, milk stocks were found to be 10.1% lower than the same period in the previous year, corresponding to a reduction of 81 million liters. This decrease in inventory was a result of increased demand both internationally and domestically.

The Argentine Observatory of Dairy Chains (OCLA) reported that the net additional supply of milk reached 375 million liters. Of this excess, 65% was directed towards exports, showcasing the growing international demand for Argentine dairy products. The remaining 35% was absorbed by the domestic market, which has been recovering from previous declines.

Domestic milk consumption in Argentina witnessed a 4% increase compared to the same period in 2025, adding an extra 132 million liters to the market. This recovery follows a significant drop in 2024, where consumption fell by approximately 19.5% in the first five months, largely due to a decrease in purchasing power.

OCLA highlighted that between 2025 and 2026, domestic consumption has almost fully recovered, although the growth has been concentrated mainly in products with lower added value. The organization also provided projections for the end of 2026, suggesting that if the current recovery pace continues, per capita consumption could reach 192.3 liters, up from 185.3 liters in 2025.

A more conservative scenario anticipates annual consumption close to 180 liters per capita, with a reference projection aiming for around 188 liters by the end of 2026. The performance of consumption in the second half of the year will be crucial in determining which scenario will prevail.