–It is explained for two reasons that have to do with the change in consumption habits that the pandemic produced. In an initial phase there was a psychosis of gathering basic and essential products such as milk and its derivatives. And then, with confinement and teleworking, there was more time for consumption – more time for breakfast, to prepare toast, for baking – and there was a clear upturn in household consumption. The growth in fluid milk consumption was of the order of 7% in the peak months of the state of alarm.
-Effectively. The consumption of liquid milk in Spain has been decreasing for 25 years. It is estimated that between 2000 and 2020 consumption decreased by around 25%. In 2000 there was a per capita consumption of about 100 liters, and now we are below 75. The only category that maintains a slight growth is that of cheeses.
-A difficult year was expected, with a scenario of decline in consumption and in which there was considerable tension in the field due to inflation and production costs. An unfortunate circumstance such as the pandemic, which increased consumption, together with the great capacity to respond to the needs of the factories dependent on Central Lechera Asturiana, made possible frankly positive results in 2020: a turnover of more than 811 million and a net profit of 18.6 million.
“The producer sector is always the most affected when there is inflation”
-Of course. In contrast, consumption in the Horeca channel (hotels, restaurants and cafeterias) decreases or practically disappears during 2020.
-Yes. In a normal year, consumption at home represents around 75%, and that destined for the hospitality channel around 25%. But what doubt that this 25% impact on the volume of turnover in a company makes commercial habits are transformed in a very remarkable way.
-In the first semester the consequences of the pandemic continued and the hospitality channel, of course, did not recover at a rate that allows us to compare it with 2019 or 2018.
–A country must value its primary sector. It is essential to be able to generate healthy and healthy products, which also contribute to both economic, social and environmental development and the fixation of the population in rural areas. In the months before the pandemic, farmers and ranchers were on the streets, and the pandemic arrived, protests disappeared and the primary sector was considered vital. Everyone spoke then of “food sovereignty” and the importance of the primary sector, but it was only a few months, while the health crisis lasted. We have a fish memory, since once the health crisis fortunately subsides, we once again give importance to pre-pandemic things. There was a residue there, but I think that the primary sector should be more valued.
–The institutions must be aware of the importance of maintaining a strong primary sector. It gives you the ability to respond in times of crisis and helps you preserve the rural environment. When we talk about generational change and the problem of depopulation, we must know that if there is no profitability it is very difficult, no matter how much vocation you have, for you to continue and transfer the profession to your children. It is important that there is a profitable value chain in all links – production, industry, distribution – and that the consumer is aware of it.
-Much. The parent group of Central Lechera Asturiana is made up of producer partners who, as farmers, are receiving the increase in costs in a very notable way every month, and the industry, which is the one that values your production, too. What increases the producer? The cost of grain in the wild, the cost of diesel, the cost of electricity, and so on. But then the milk reaches the factory, which it owns, and it turns out that the industry, which is the one that transforms that to put it on the market, also increases the costs of CO2 emission rights, electricity , plastics, waste management.
–All our costs increase because there is inflation that affects us and, however, we cannot pass it on to the prices of our products in the same way. It is important that the entire value chain has a performance and, of course, the producer as well. I think that the producing sector, and especially the dairy sector, is always, in the end, the biggest victim when there are inflation scenarios. In any case, the Central Lechera producer partners also see the benefits produced by our industry, CAPSA, reflected in the price of their milk, which means that we have a better situation than other livestock communities. On the other hand, final prices have been stagnant for more than ten years.
“We’re trying to bet on cheese.” In fact, one of the operations we carried out last year was the acquisition of Flor de Burgos. Cheese is one of the categories in which consumption does not decrease and we are, of course, attentive to the market. We are also cheese makers.
–Our main strategic lines are based on diversification around dairy products. We are committed to products linked to the pharmacy channel with a very interesting project; It is betting, as I said, on the cheese area, and successes are also being reaped in the export of dairy products. There is not a very noticeable volume yet, but it is a recurring and profitable volume.
-Absolutely. Central Lechera Asturiana is based on family farms. The orography of Asturias, and that of the Cantabrian coast in general, is based on smallholdings and there are no excessively large lands. But they are farms that are dimensioned and linked to the terrain, highly professionalized and with a great capacity for adaptation. Obviously, they have to be updated both at a technical and training level so that the farms are profitable, but you have to think that there are European guidelines linked to the Green Pact that seek farms with a certain size, and the herds that are under the umbrella of Central Lechera they fit very well in that model. I think the family model, of course, has a future.
–There are two basic factors. First of all, the profitability is very fair. And the greater the difficulty to obtain profitability, the less obviously is the generational change. And, secondly, it is a profession that requires a lot of vocation. There are 365 days of work a year and a lot of knowledge is required. Today’s farmer must have knowledge of veterinary medicine, economics, mechanics, etc. This job requires a lot of responsibility and a lot of dedication.
“Institutions must be more aware of the importance of maintaining a strong primary sector”
– We continue to drag the burden that for many years there was no social recognition of livestock farmers for the activity, and that has also hampered continuity. However, I believe that the recognition and importance of livestock and agriculture in any advanced society is increasingly being promoted. At Central Lechera Asturiana we strive so that this drama that is the generational change affects as little as possible through greater profitability, promoting programs that help professionalization and improving the efficiency of farms.
–The great challenge of Central Lechera Asturiana is to boost the profitability of the farms through dividends and, in turn, promote projects that improve the quality of life and contribute to the generational change, which continues to be a problem that we must tackle. The idea is that, despite the decrease in the number of herds, the partners maintain a profitable and sufficiently recognized activity. Central Lechera is an instrument created for this purpose.
–The CAP and the great European Green Deal have positive aspects, but there are also others whose effectiveness remains to be seen. In the productive aspect, for example, it remains to be seen if the restrictions both in the use of fertilizers and herbicides and in the ways of working the land, which are expected to increase costs, will then be able to translate into the consumer I will reward it. Because if we are going to see costs increase, apart from those that are already traditional, and that does not affect the chain later, in the end what we are going to have is bigger problems.
–We have, for example, an important collaboration agreement with EDP. Our farmers use electrical energy that comes from renewable sources, from wind energy produced in Asturias. And, on the other hand, we have another alliance with EDP_for the installation of photovoltaic panels in livestock farms. We have a pioneering circular economy project for the enhancement of organic waste from cows with the company Biogastur, of which we now have one hundred percent shareholding. Our factories are zero waste and carbon neutral, and we have just added the first collection tank powered by liquefied natural gas.
- BILLING: 811,4 millions of euros
- NET PROFIT: 18,6 millions of euros
- 6.971 PARTNERS
- 1.057 FAMILY LIVESTOCK
- 1.148 EMPLOYEES
IN PERSONAL PASSWORD
A lifelong rancher
In his house he had always won. His grandparents became members of Central Lechera Asturiana when the cooperative was born by the hand of Jesús Sáenz de Miera, and his parents continued the family tradition.
“I have been a lifelong rancher because it is what I have seen at home since I was a child,” says Alberto Álvarez, who is grateful and positive that, as a child, he could help on the farm. His childhood memories are tied to her.
He studied forest engineering and worked for a few years in companies linked to the agroforestry sector, but when his parents got older and had to choose between engineering and livestock, he was clear: he opted for the vocation and continued with the family livestock.
Alberto Álvarez believes that “the entrepreneur is born, but the manager is made”, and considers that involvement, work, the culture of effort and the permanent predisposition to listen and learn are essential values at the head of a company.
He is married, has a daughter, who is “the apple of his eye”, and in the little free time he has between the farm and the company, he likes to enjoy reading, music and movies.
Start the day with energy. He has milk with cocoa for breakfast, along with whole wheat toast with butter and jam, and some fruit. The milk and butter, of course, are from Central Lechera Asturiana.
Eddie is an Australian news reporter with over 9 years in the industry and has published on Forbes and tech crunch.