Overall, autumn was relatively dry, but at the end of May, there was finally some good rainfall. This was good for row crop farmers to harvest summer crops and seed winter crops. Not very positive for cattle farmers. After a dry summer, there was very little grassland available. This autumn didn´t help to recover grasses or grow good forages. Beginning of June saw a decline in temperatures with first nights with frost. This is normal for the time of the year.
Market Update June 2020
Monthly market update providing objective information about crops, cattle, forestry and other diverse farming business in Uruguay.
The number of animals sent to slaughter in May was the lowest in 17 years due to lack of supply and lower international demand as a result of Covid-19. Most slaughterhouses continue operations, but a few cancelled their activities due to lower demand and worker protests.
OLAM Uruguay as owner of the New Zealand Farming Systems operated several dairy farms throughout the country. Their business model was never very successful. They decided to end their dairy operations in the East and West of the country and focus on dairy activities in Florida (center south of Uruguay). Dairy farmers in Uruguay are all struggling with relatively low milk prices. The coming winter will be rough due to lack of good grassland and the additional expense of animal feed.
Summer crops didn´t have very good yields this year due to a lack of rainfall in January and February. In soybeans, yields are close to 2.000 kg per hectare which is well below the national average. In fact, for most farmers results will not reach a break even. For that reason, more than ever crop farmers look at winter crops to recover some of the losses. Only rice had good yields this year. The expectation is that the area in winter crops with canola will grow most, followed by barley, but less area for wheat. Slowly we are seeing some experiments with lupine.
The export of citrus to Vietnam was permitted by authorities. This is good news for citrus producers in Uruguay who see growing potential for export markets worldwide.
UPM once again confirmed its decision to start with the construction of their second pulp mill in Uruguay. Conversations with the new government after the outbreak of corona-virus led the company to accelerate certain investments in infrastructure as to minimize the economic impact of this crisis.