Logistics Can Account for 29% of Dairy Costs in Argentina
Sector estimates cited by iProfesional place logistics behind milk as the second-largest component of a dairy company’s cost structure in Argentina. The estimate covers warehousing, distribution and transport, but it is not an official industry-wide statistic. Its level can differ according to the company, the product and the sales network.
Cold-chain requirements distinguish many dairy products from other food categories. Under Argentina’s Food Code, packaged pasteurised milk must be kept at no more than 8°C during storage, transport and sale. Fermented milks, including yoghurt, must be conserved and marketed at no more than 10°C. Compliance requires refrigerated vehicles and chambers, cooling equipment, energy, maintenance and monitoring. More perishable goods also allow less flexibility in delivery schedules.
UHT milk has different transport requirements while unopened and properly packaged. It does not need the same refrigerated chain as yoghurt or pasteurised milk and has a substantially longer commercial life. Fresh and chilled products therefore involve tighter controls over time and temperature, while yoghurt, cheese, butter and long-life milk can require different distribution arrangements.
Vehicle utilisation is another factor in the cost per unit. A delivery route incurs many of the same expenses whether a truck is full or carries unused capacity. When those expenses are spread across more boxes, litres or kilograms, the charge per unit falls; transporting less product over a similar route has the opposite effect. Fuel is estimated to represent 33% to 38% of total road-transport costs on medium- and long-distance journeys. Maintenance, wages, tyres, financing, refrigeration and unproductive time also contribute.
Argentina’s dairy industry is relatively fragmented. Data from OCLA show that the five largest companies receive 36% of national milk production, while the equivalent figure in many international dairy systems is above 80%. The country’s largest company processes about 11.9% of milk, compared with leading-company shares of between 25% and 90% in some major dairy-producing countries. The structure can leave several companies operating distribution centres, warehouses, commercial teams and trucks in overlapping areas.
Recent corporate activity includes the integration of Arcor and Danone’s businesses with Mastellone, Gloria’s acquisition of Saputo’s Argentine operation, and Adecoagro’s efforts to expand its capacity. SanCor and ARSA assets have also attracted interest. Changes in ownership and scale may affect vehicle loads, route consolidation, warehouses and distribution centres, although the effects depend on plant locations, markets served and the products manufactured.
Taxation is also included in the cost analysis. IARAF estimated that the legal tax burden embedded in the final price of a food product could reach about 42% in small shops and 43% in large retailers. The calculation concerns a product subject to the full 21% value-added tax and combines national, provincial and municipal taxes across a model supply chain. It does not mean that 43% of the price of every dairy product consists of taxes; the actual burden varies by product, tax treatment, company, province, municipality and sales channel.
Argentina produced 7.515bn litres of milk between January and August, 4.5% more than in the same period of 2025. Exports also increased and absorbed much of the additional supply. As production, exports and domestic consumption expand, the industry will need to transport larger volumes. The estimate that logistics account for 29% of a dairy company’s costs is therefore a sector reference rather than a universal measure for all dairy businesses.
