Argentine Dairy Industry Faces Critical Turmoil
Source: dairynews.today
Major Argentine dairy companies like SanCor and La Serenísima are grappling with a financial crisis, with others such as ARSA and La Lácteo also entering critical conditions due to sales decline and union disputes.
The Argentine dairy industry is experiencing significant turbulence, marked by dwindling sales, rising labor costs, and union pressures. Notably, companies like SanCor and La Serenísima, renowned stalwarts, are in uncertain situations. SanCor is undergoing a creditor review process with a staggering debt of approximately $400 million, resulting in reduced daily processing levels to a historical low of 60,000 liters. Moreover, labor reductions have seen staff numbers plummet from 1,350 to 850 over a year. Meanwhile, La Serenísima faces a tense negotiation over financial control with Arcor and Danone, amid shareholder dissatisfaction regarding the offer on the table, suggesting urgency as their contract deadline approaches.
In addition to these, ARSA and La Lácteo, known for brands like Yogs and Shimy, confront their crises. ARSA announced a 30-day production halt due to operational and financial hurdles, compounded by disputes with the ATILRA union last year that threatened total shutdowns. La Lácteo, also embroiled in conflicts with the union, suffered severe financial setbacks following a two-month blockage, resulting in supplier losses and decreased sales. This has pressured the company to negotiate a potential acquisition by La Ramada, with hopes of stabilizing by transferring up to 50% of its shares to secure financial relief. Such issues underscore the systemic vulnerability within Argentina's dairy sector, fueled by a tight consumer market and broader economic challenges.
In addition to these, ARSA and La Lácteo, known for brands like Yogs and Shimy, confront their crises. ARSA announced a 30-day production halt due to operational and financial hurdles, compounded by disputes with the ATILRA union last year that threatened total shutdowns. La Lácteo, also embroiled in conflicts with the union, suffered severe financial setbacks following a two-month blockage, resulting in supplier losses and decreased sales. This has pressured the company to negotiate a potential acquisition by La Ramada, with hopes of stabilizing by transferring up to 50% of its shares to secure financial relief. Such issues underscore the systemic vulnerability within Argentina's dairy sector, fueled by a tight consumer market and broader economic challenges.
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