McDonald’s To Save $10 Million A Year Making Cheese In Argentina

Patrick Archer agribusiness, competitiveness, foreign investment, franchises, us companies

Arcos Dorados Queso Argentina

The cheddar cheese investment is part of an aggressive move to nationalize ingredient procurement.

When it comes to the subject of Argentina’s exorbitant import tariffs, the Golden Arches is definitely not Lovin’ It. But a cheddar crisis has created a golden opportunity resulting in new investment and job creation in Argentina.

Arcos Dorados, the world’s largest McDonald’s franchisee, just announced that it will invest $30 million pesos in a new cheese production plant in the Province of Santa Fe. The plant will be built in conjunction with Milkaut Argentina, a subsidiary of French agribusiness giant¬†Groupe Soparind-Bongrain.

The new Milkaut plant will employ 40 workers and produce 4,000 tons of cheddar cheese for McDonald’s restaurants annually. In the process, the Santa Fe queso cheddar will save the company an estimated US$10 million a year on cheese-related import tariffs.

According to Diario Norte, Milkaut is already a strategic supplier of McDonald’s in Argentina and other Latin American countries. The new cheese investment forms part of McDonald’s aggressive plan to nationalize the production of all ingredients. Now only 5% of ingredients are imported to Argentina. (Full Story in Spanish)

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