‘The Argentinean Dairy Industry – Strategic Review & Outlook’ (December 2012)
Dairymark has a multi-client report entitled ‘The Argentinean Dairy Industry – Strategic Review & Outlook’ (December 2012).
Details on the report are attached: Click here. In addition we advise:
- This report has been predicated on the basis that Latin America is a key development point for the global dairy industry, both in terms of burgeoning demand and growing milk production. A cursory view could assess that the nations within Latin America will balance themselves out – that production growth within the region will be dealt with by growing consumption. However the reality is that this will not be the case.
- Argentina is a case in point – having suffered fluctuations in milk production through recent times, the Argentinean Government has determined the dairy industry as a key strategic pillar for economic and social recovery for a country that has been dealt severe blows both well before and during the recent GFC. Forecasts provided in the report are for a return to sustained milk growth through the foreseeable future, and this will deliver an ongoing milk surplus for export. Given that the Argentinean market is comparatively mature on a per capita consumption basis, the growth arising from an increase in milk production is expected to go to international markets.
- Argentina is not intent on being corralled within Latin America. The Argentinean dairy industry has been actively diversifying its export markets, both in terms of geographic mix, and product offerings. So much so that Argentinean dairy exports rank Algeria as their third most important market after Venezuela and Brazil, and Argentinean dairy products shipped to offshore markets range through a full continuum of milk powders, cheese, whey products, dulce-de-leche, aseptic milk, and others.
- Of importance, farm returns are expected to improve along with more intensive on-farm management efficiency (including a move from solely pasture-based to pasture & supplemental feeding), and ongoing milk and finished product quality improvements. These and other pursuits are largely based on structural tenets that the Argentinean Government has encouraged, and these feed directly to underpin the post-farm gate sector with viable milk production that delivers quality product.
- The processing sector is fragmented and heterogeneous. A plethora of small local artisan milk processors sit alongside large modern milk processing plants. Foreign investment into the sector has been significant, and the likes of Fonterra, Groupe Danone, FrieslandCampina, Agropur, Arla and Saputo have an equity interest in the industry in order to deliver their own strategic aims. Company profiles are provided for a good selection of major players in Argentina’s dairy industry – both MNCs, and local corporate.