Milk production growth has recently been lagging year-earlier levels in most global supply regions, but production in South America has been strong in the region’s major exporting countries, Argentina and Uruguay. Both posted substantial year-over-year growth through most of 2021, even as production across the other South American countries was mixed.

“Despite these gains, headwinds have picked up and South America’s record of bucking the global trend of shrinking production has come under threat,” said Monica Ganley, analyst with the Daily Dairy Report and principal of Quaterra, a consulting firm in Buenos Aries.

For the first 11 months of 2021, milk production in Argentina was 4.3% stronger than the comparable period in 2020. In Uruguay, the year-to-date increase over the same period was 2.1%, putting Uruguay on track for record milk production in 2021, Ganley noted. That said, milk production in Uruguay has started to soften due to margin pressure and weather issues, while monthly gains in Argentina continue to be strong.


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