As a result of the closure of Grupo Lala's factory in Costa Rica, the 37 thousand liters of milk that 70 local producers sold daily to the company of Mexican origin were left without a buyer, however, Dos Pinos promised to acquire the product.
On December 1st Grupo Lala informed that it will close the milk plant that operates in the province of Alajuela. According to the company, the factory will stop operating on December 11th.
After Grupo Lala decided to close the operations of its dairy production plant in Costa Rica, a debate began over whether Dos Pinos' dominance in the local market was due to protectionist policies or to the brand positioning, quality and price of its products.
Arguing that there is greater potential for sustainable and profitable expansion in Nicaragua and Guatemala, the Mexican business group dedicated to dairy production decided to close the operations of its production plant in Costa Rica.
From January to September 2019, trade in milk and dairy products among the countries of the region reached $245 million, 2% more than in the same period in 2018.
Figures from the Trade Intelligence Unit at CentralAmericaData: [GRAFICA caption="Click to interact with graphics"]
Guatemalan producers say the Honduran authorities refuse to inspect their plants, preventing them from exporting milk to that market, so they ask the Guatemalan Ministry of Economy to apply reciprocal measures.
According to the directors of the Dairy Development Association (Asodel) and the Chamber of Dairy Producers of Guatemala, with the aim of authorizing sanitary permits, a year ago they waited for the National Agrifood Health and Safety Service (Senasa) of Honduras to visit the production plants, but the Honduran authorities refused to do so.
In Costa Rica, the cooperative Coopeleche increased by 25% the volume of raw material sold to the Mexican Lala, a rise that would be explained by the better positioning of the company in the local market.
In general, volumes produced have increased, since official figures detail that between 2017 and 2018, milk production in Costa Rica grew by 1.5%, going from 1.14 million to 1.16 million tons.
From January to March of this year, trade in milk and dairy products between the countries of the region totaled $78 million, 2% more than in the same period in 2018.
Figures from the Trade Intelligence Unit of CentralAmericaData: [GRAFICA caption="Click to interact with graphic"]
Dos Pinos and Distribuidora Corripio invested $30 million in the construction of a plant that has an area of 8,500 square meters and a packaging capacity of 250,000 liters per day.
The Costa Rican Cooperative of Milk Producers Dos Pinos and Distribuidora Corripio, founded the Caribbean Dairy Group, being their first joint investment the construction of the new industrial plant, which will produce 50 varieties of dairy products, juices, nectars and soft drinks of the Dos Pinos and La Granja brands.
Mexico's Lala invested $14 million in the purchase of high-tech machinery and the expansion of its dairy plant located in San Ramon, Alajuela province.
Managers of the Mexican company reported that the area of the facilities was expanded from 4,240 m2 to 24,250 m2, and with this expansion the company reaches a processing capacity in the country of 150 thousand liters of milk per day. The plant in question is the one that was purchased by Lala Group from Florida Bebidas in 2016.
In the first half of the year, trade in milk and dairy products between Central American countries totaled $151 million, and more than 40% was bought by companies in El Salvador.
Figures from the information system on the Milk and Dairy Market in Central America complied by the Business Intelligence Unit at CentralAmericaData: [GRAFICA caption="Click to interact with graphic"]
The regional guild of the sector reported that the volume of milk produced by the countries of the region increased from 3.5 to 3.7 million metric tons between 2015 and 2016.
According to figures from the Central American guilds, the increase in global production registered in 2016, when the most updated statistics exist as a region, is explained by increases reported in all countries, mainly from Costa Rica with 18%, followed by El Salvador with 14%, Guatemala with 13%, Panama with 6%, and Honduras with 4%.
In the first quarter of the year, trade in milk and dairy products among Central American countries totaled $77 million, and 73% was purchased by companies in El Salvador and Guatemala.
Figures from the Information System on the Milk and Milk Products Market in Central America, compiled by the Business Intelligence Unit at CentralAmericaData: [GRAFICA caption = "Click to interact with graph"]
The production plant that Grupo Lala is building in Escuintla, Guatemala, will be ready to start operating in September.
The milk production that will be shipped from the plant in Palin, Escuintla, will go to the southern market of Mexico, Honduras and El Salvador, according to representatives of the company of Mexican origin.
With the expansion carried out by Nestlé at its plant in the Dominican Republic, the company will have the capacity to produce 12,000 containers for ultra-pasteurized products per hour.
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