Paraguay’s dairy industry faces stagnation, with production challenges threatening exports in 2025. Erno Becker, President of the Paraguayan Dairy Industry Chamber (Capainlac), attributes the issue to unfavorable climatic conditions affecting cattle feed. Paraguay, which produces around 1 billion liters of milk annually, may see a 5% decline in output. While exports reached 22,318 tonnes in 2024, valued at over $80 million, concerns about raw material shortages persist. The industry is now focusing on strengthening domestic sales while exploring new international markets.
Paraguay’s dairy industry is facing a period of stagnation, with production challenges potentially affecting exports in 2025, according to Erno Becker, President of the Paraguayan Dairy Industry Chamber (Capainlac). Capainlac is a key organization representing Paraguay’s dairy producers, focusing on industry development, policy advocacy, and ensuring sustainable milk production.
Production Struggles Amid Climatic Challenges
In 2024, Paraguay’s milk production has remained stagnant, primarily due to unfavorable weather conditions affecting cattle feed, particularly maize. The country currently produces approximately 1 billion liters of milk annually, but Becker anticipates a further 5% decline this year. Reduced feed quality has directly impacted dairy output, creating concerns for both domestic supply and international commitments.
Impact on Exports and Market Shifts
Paraguay’s dairy sector has been relying on exports, particularly to Brazil, its primary international market. In 2024, the country exported 22,318 tonnes of dairy products, generating over $80 million in revenue, surpassing the figures from 2023. However, ongoing production difficulties have led to the suspension of some export channels due to raw material shortages.
While Paraguay aims to maintain its strong trade relationship with Brazil, the industry is increasingly shifting focus toward domestic sales. Local demand offers higher profitability, and discussions are underway to expand market access beyond Brazil.
Despite the current stagnation, some producers are adopting strategies to mitigate losses, including delayed insemination to improve milk yields. Experts believe these efforts, combined with potential improvements in weather conditions, could help stabilize production levels in the coming years.
The Paraguayan dairy industry now faces a critical period of adaptation, balancing export commitments with domestic market growth. With strategic planning and resource management, the sector aims to overcome these challenges and maintain its position as a key player in Latin America’s dairy market.
