Period: March 16 – 27, 2020
Argentina+9.9% milk production February 2020 y-o-y
In South America, milk production is seasonally increasing. During the past weeks, lower temperatures and scattered showers have helped boosting dairy cows’ yields and soil moisture in several corn and soybean farming areas. Compared to the rest of the world, South America has had more time to prepare for the impact of coronavirus. Preventing the spread of COVID-19 is the main issue addressed in most nations of the continent, including Brazil, Argentina, and Uruguay.
In Argentina, the government placed a national quarantine from March 19th until March 31st. This mandatory isolation policy does not include farmers working in activities related to the production, distribution, and marketing of processed food. Nevertheless, physical agricultural markets are suspended. The availability of food for families is essential during this period, so most dairy farms and dairy processing plants are actively operating, but have taken various security measures, such as downsizing of staff and social distancing.
In Brazil, at the moment, there are no mandatory official policies related to the coronavirus prevention. However, at local level, the state of Sao Paulo has initiated a quarantine that will last from March 24th to April 7th. Milk production is seasonally higher. Most shipments of bottled milk have been destined to the retail sector, triggered by strong atypical demand. On the contrary, fluid milk orders from the food service sector are slow due to the coronavirus crisis. Several industry stakeholders say cheese production is less active, as well as the demand, considering that fewer manufacturing milk volumes are accessible for the production. SMP export prices in South America adjusted lower. Production is limited, but inventories remain readily available to meet immediate needs. Due to COVID-19, the trading activity within and outside the continent is reported as weak. In South America, SMP production is unsteady, as there are lower volumes of milk available for dryers, considering that most of the milk is destined for direct sales. Due to coronavirus, also WMP prices are decreasing.