Uruguay's economy remains dependent on agriculture and services. Agriculture and agri-industry account for 12% of GDP, and for about 70% of total exports. Agriculture in Uruguay has witnessed great changes during the last decade. Uruguay’s major agricultural products are soybeans, rice, wheat, maize, sorghum, citrus fruits (mainly oranges, tangerines, lemons, and grapefruits), and deciduous fruits (mainly apples, pears, peaches, plums, quince, and nectarines). The factors driving the market are the abundant arable land, which accounts for 16.4 million hectares (93% of the country's total land area), and favorable government policies like, no limitations or restrictions on the export of agro-industrial goods.
Key Market Trends
Demand from Food and Beverage Industry
Much of the country's industrial sector is linked to agriculture. About half of all industrial production is based on food processing or the refining of agricultural products such as leather. Food and beverage products are the largest single manufacturing sectors, with food processing accounting for 25 percent of production and beverages accounting for 11 percent in 2018.
Prepared rice, chocolate, cookies, and pasta are the main exports of Uruguay. The nation's principal food processing plants are concentrated in the towns of Fray Bentos and Paysanduu. The key markets for processed foods and beverages include Uruguay's MERCOSUR partners.
Rice and Soybean Dominates the Cereals Segment
In 2018, Rice and soybean are the leading crops in terms of production in Uruguay with 1.36 and 1.33 million tonnes, respectively. The main reason for the high production of rice and soybean is its demand in the international market. Only 20% of rice produced is consumed locally and 80% of rice is exported to other countries. Uruguay is the 7th largest exporter of soybean in the world with an export value of USD 10 billion in 2019. Maize, barley, wheat, sorghum, and oats are the other cereals grown in Uruguay.
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