Miller Magazine Issue: 131 November 2020

uruguay 83 MILLER / November 2020 duction is currently around 49.000 tonnes. This industry was severely affected by unpaid debts of the Venezuelan government and never recovered. There are some rather large companies, which employ modern technology, but they pale in comparison against Brazilian and Argentinian competitors, despite having good conditions for growth. The swine industry, on the other hand, is almost non-existent. Total pig population was 297.000 heads in 2007, producing 21.000 tonnes of meat. That was com- pleted with 11.000 tonnes of pig meat imported from Brazil. Less than 10.000 sows are in intensive or semi-in- tensive production. The market also lacks integrators and large production units. The Uruguayan market is crying for large scale invest- ments, that cover for the deficit in the pig and chick- en meat, and also to supply to the ailing Argentina. A good reference is the market in Rio Grande do Sul (the southern most state of Brazil) which has almost the same territory and geographic conditions, but has 151 millions of birds (both meat and egg producing). Uruguay has around 7,5 million birds for meat production. We can estimate the number of laying hens in 3,1 mil- lions. Talking about equipment pro- duction, the country doesn’t have a single local manufacturer of neither silos nor milling equipment, while there are several in both Brazil and Argentina. CONSUMPTION Uruguay produces around 22.000 tonnes per month of wheat flour. The baking industry processes around 74% of them. There are over 1.500 bakeries in the whole country, with 780 of them in Montevideo. However, il- legal baking is widespread and it is impossible to know how many of those are out there. Many products sold in established businesses, like gas stations and small su- permarkets, are in fact manufactured at illegal bakeries, without any sanitary or fiscal controls. I, myself, buy pre- baked pizzas and pastries from a couple of ladies that knock the door of my house every week. Per capita consumption of bread varies according to sources, but should be between 55 kg and 86 kg per year. Per capita consumption of rice is 12 kg per year, much lower than in other Latin American countries. This is probably because Uruguayans have bread with every meal, instead of using rice as universal garnish, as Brazil- ians and Venezuelans do. Pet food is a booming business, with 11.000 tonnes per month and growing, with consumers gravitating towards higher end products. The consumption of breakfast cereals is not very ex- tended. They are consumed mostly as a snack. However, 54% of the teenagers have breakfast of very poor nutri- tional quality, with 28% (of the total) not having break- fast everyday. So, there is room for growth. PANDEMIC Uruguay is one of the countries less affected by coro- navirus. As Sweden, we never a real lockdown to speak off. Schools, cinemas and discos, as other closed public spaces, were closed for a while, but people were mostly free to choose what to do. Masks are required to enter in places like buses, shopping malls and schools, but you can go out jogging without your mask and nobody will care. Small convenience stores don’t even ask for you to wear one. That helped preserve the economy a little bit, but we are still dealing with a slow boiling crisis that started with the bust of the commodities. The strategy of the current gov- ernment to improve the economy is, basically, stealing entrepreneurs from Argentina. The minimum cap- ital to declare fiscal residency has been reduced to a home of USD 380.000 or a company of USD 1.680.000 employing at least 15 people, with a minimum of 60 days per year living in our country. For small entrepreneurs, the situ- ation may not look so good, as the cost of life is so much higher in Uruguay than in other countries, and special- ized labor is hard to find, but for big companies, the pros- pect is completely different. Income tax for companies investing in Uruguay may be reduced significantly, and any Municipality (Intendencias) out of Montevideo will be happy to provide land or even abandoned buildings owned by the local government. Also, imports of indus- trial equipment may be exempted from VAT. One can only speculate, but Gustavo Grobocopatel, the owner of Los Grobo, recently quit his position as President and moved to Uruguay. He still owns a partic- ipation in Los Grobo, but no longer works in the Board. *Gustavo Sosa lives in Uruguay. He is a Mechanical Engineer and MBA, with 20 years of experience in post harvest and milling of grains. He is currently unemployed and looking for opportunities. Take a look at his profile in https://www.linkedin.com/in/inggustavososa or send him an email to cgsosa@outlook.com . Crop area (2020) Summer crops Rice Soybeans 140.000 ha Corn 917.000 ha Sorghum 116.000 ha Winter crops 22.000 ha Wheat 220.000 ha Barley 152.000 ha Canola 15.000 ha Rapeseed 80.000 ha