So far in April, arrivals at industries have decreased between 5% and 6%; exports will also fall.
Due to floods in the major dairy areas of Santa Fe and Córdoba and complications of excesses in water in Buenos Aires, the reception of milk fell in the first two weeks of April between 5 and 6% comparing to the same period last year. The major companies are getting one million liters per day less from the milking yards. For entrepreneurs, the reduction does not compromise the supply in the domestic market, but it will lead to reduce exports.
“At the general level, in these first two weeks of April we are down by 5 to 6% comparing to last year”, pointed out Miguel Paulón, president of “Centro de la Industria Lechera” (CIL).
This camera includes 22 companies that process 65% of the daily production of milk. Through these firms usually, on average, passes 17 to 18 million liters per day provided by the milking yards.
Paulón estimated that the volume that was not received anymore oscillates around one million liters per day at national level. Some companies in particular exhibit steeper declines. For example, firms that buy in the Central-West region of Santa Fe and east of Córdoba had reductions of 25 percent.
Major complications are on the side of the garbage trucks that can not access countryside due to impassable roads.
According to the president of “Centro de la Industria Lechera”, «there will be no problems with the supply in the domestic market”. However, he admitted an impact on foreign trade. «Exports will be reduced», said Paulón.
According to the Ministry of Agriculture, in the first quarter of this year, exports of dairy products had increased in volume by 20% over the same period during last year. There were 89,876 tons in the first quarter of 2014, compared to 75,480 tonnes over the same period in 2013.
Fewer Sales
Apart from this fact about the agricultural portfolio, in March a brake on exports became known. In fact, although not yet published the information of March, statistics from Servicio Nacional de Sanidad y Calidad Agroalimentaria (SENASA) show that already in the first two months of this year, a declination in volume has occurred. 68,275 tonnes of January / February 2013 declined in January / February 2014 to 60,961 tons.
Meanwhile, on the milking yards that supply the raw materials to industries, the situation is critical. In the center of Santa Fe has been reported drops up to 40% of the production. The Minister of Production of the Province, Carlos Fascendini estimated that in the dairy farming sector losses are already around $1 billion.
Today the cows are in the middle of the mud and have difficulty accessing a normal diet. Therefore production suffers.
Rodolfo Tkachuk, coordinator of the area of Santa Fe Centro de los Consorcios Regionales de Experimentación Agrícola (CREA), said that, after the storm, CREA milking yards are «picking up» production, but the situation is different in other establishments, with «many small milking yards affected» and industries came to report a declination of 40% in reception.
According to the producers, the difficulties with the weather add up to a difficult economic scenario, with incomes that do not cover costs. Dairy farmers are demanding a rise in the price they charge. Receive an average of 2.70 to 2.75 pesos a liter, but their costs exceed $ 3, they warn.
Besides talking about the impact of rain on the milking yards in Santa Fe, the National Milk Producers Board, which is following a schedule of meetings with provincial authorities, yesterday also dealt with the claim made by Fascendini concerning updating prices.
Source: Lechería Latina