Argentina’s dairy industry faces systemic collapse, with leading companies like SanCor and La Serenísima struggling under massive debt, union tensions, and plummeting production.
Argentina’s dairy sector, once a resilient pillar of the national food economy, is now in the grip of an escalating crisis. The industry is grappling with declining sales, surging operational costs, and tense labor disputes, which have placed even its most iconic companies in precarious positions.
SanCor, one of Argentina’s most recognized dairy cooperatives, is in particularly dire straits. With an estimated debt of $400 million, SanCor is undergoing a creditor review that has drastically impacted its production. From processing over a million liters daily in its prime, it now handles just 60,000 liters per day—a historic low. Over the past year, employee numbers have dropped from 1,350 to just 850, further indicating the financial strain.
Meanwhile, La Serenísima, a household name in Argentina’s dairy aisle, is facing its own turmoil. Currently navigating a contentious financial control negotiation with Arcor and Danone, the company faces pressure from shareholders who are unhappy with current offers. As the contract deadline nears, uncertainty clouds the future of the business.
Other dairy players are not faring better. ARSA, the company behind the Yogs and Shimy brands, recently announced a 30-day production halt due to both financial hurdles and operational issues. Past labor conflicts with the ATILRA union nearly forced a complete shutdown in 2023, and tensions continue to strain business viability.
La Lácteo, another significant name, also suffered severe losses due to a two-month union blockade, which led to a dramatic decline in sales and supplier losses. Currently, the company is in talks with La Ramada, aiming to stabilize operations by selling up to 50% of its shares. This move is seen as a last-ditch effort to stay afloat.
The crisis facing these companies highlights a broader structural fragility within Argentina’s dairy industry. High inflation, economic instability, union pressures, and a shrinking consumer base have all contributed to a sector-wide downturn. Unless urgent reforms or investments are made, Argentina’s dairy market risks significant long-term contraction.
