Uruguay

GIEWS Country Brief: Uruguay 17-May-2019

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FOOD SECURITY SNAPSHOT

  • Rice production in 2019 estimated to decline, while maize production expected well above-average

  • Cereal exports in 2019/20 expected below average on account of decreased rice output

  • Prices of rice and wheat grain higher than year-earlier levels

Rice production in 2019 estimated to decline, while maize production expected at well above-average

Cereal production in 2019 is forecast to rebound to slightly above-average levels of 3.5 million tonnes, mainly reflecting an increase in maize production.

Harvesting of the 2019 rice and maize crop has recently completed. Production of rice (paddy) is estimated at 1.2 million tonnes, 12 percent lower than the previous five-year average.
The decline in production is mainly due to lower planting areas, as farmers shifted to plant more lucrative crops, on account of high production costs of rice. By contrast, production of maize is estimated at a near record level of 700 000 tonnes, mainly reflecting larger plantings as farmers opted to plant maize over soybean due to excessive rainfalls during the planting period of soybean. Production prospects were also boosted by excellent yields due to favourable weather conditions.

The 2018/19 wheat season was completed in January 2019, with record high yields. However, production was estimated at a below-average level of 728 000 tonnes as a result of the significant contraction in plantings. Planting of the 2019/20 crop will start in mid-May and the area planted is expected to rebound, instigated by the high level of prices.

Cereal exports in 2019/20 expected below average due to decreased 2019 rice output

Total cereal exports in the 2019/20 marketing year (April/March) are forecast at 1.2 million tonnes, 7 percent lower than average, on account of the estimated decline in 2019 rice production. Rice exports account for about 70 percent of the total cereal exports. Due to the bumper 2019 maize output, maize exports are anticipated to resume after five years.

Prices of rice and wheat grain higher than year-earlier levels

In April, wholesale prices of rice increased despite the commercialization of recently harvested crops and were 17 percent above their year-earlier levels, mainly reflecting lower production. By contrast, prices of maize decreased significantly and were below their levels a year earlier, as the bumper output improved local supplies. Prices of wheat grain were 40 percent higher year on year mainly due to large exports in the first quarter of 2019, sustained by the significant depreciation of the country’s currency