Dairying in Argentina

The year 2015, with 12,061 million liters, marked the highest milk production in Argentina. Due to the crisis, it fell -14.7% in its milk production during 2016 and another -1.9% less in 2017 hitting bottom. The lost milk is slowly being recovered, slowed down by fewer cows in the national herd. The year 2019 closed with -1.74% compared to 2018 to total 10,343 million liters and 2020 with 11,113 million liters Argentina once again occupies its place as the 3rd exporter of whole milk powder. Of that volume, about 8,550 liters are consumed (at a rate of 180 equivalent liters / capita), leaving an exportable remainder of 2,563 million liters (57 liters / capita). The industry maintains a level of spending + investment of nearly 4,000 million a year (AACREA, 2011) and shows a level of direct employment, and dairy industry, around 84,000 jobs (Yearbook 2013, FUNPEL).

Local dairying market needs transparency in the milk price formation, as well as information related to the general operations of the dairy chain. Also generate an economic environment with clear rules and legal certainty that will attract investments to expand the installed milk drying capacity to ensure increase of the export volumes. On the other hand Argentina while releasing the dairy trade, both domestically and externally, must implement automatic export VAT refund and support the activity with export pre-financing, inventory financing and loans at reduced rate for industrial investments and / or the production sector.

As is shown in next graf of relative values, Argentina´s dairying copies mayor exporting countries in terms of mantaining a farm concentration trend:

Evolution of argentine dairy systems

Also take a look to the Argentine dairy production systems post.

Marcos Snyder

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