The Business Case for Forestry Investment in Uruguay

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In Uruguay, investors are presented with a variety of options when it comes to forestry investments. They can opt for either eucalyptus for the pulp industry, eucalyptus for the building industry, or pine trees such as radiata pine. Moreover, they can choose between land that has already been planted or pastoral land suitable for plantation. Additionally, they may consider already forested land that has not yet been harvested or land that has already undergone one harvest, as eucalyptus can regrow and undergo a second cycle.

Another critical aspect is whether to lease the land or contract a forestry manager. This decision can have a significant impact on the return on investment.

One of the advantages of forestry investments is the low cost of maintenance and fire insurance, along with the possibility of earning revenue from livestock. After a decade, the first harvest can be obtained, followed by the second harvest in the twenty-first year. Typically, the yield of the second harvest is 75% of the first harvest, but without the cost of planting. Following twenty years, new trees can be planted using the forestry layout of the farm.

Uruguay is fortunate to have internationally recognized mills such as UPM and Montes del Plata, creating an advantage for forestry investors. In addition, there is a strong demand for the export of chips to Portugal and quality wood for manufacturing purposes.

It is important to note that the forestry law of 1987 outlines the soil types suitable for forestry investments while prohibiting planting trees commercially in certain areas.

Contact the Gateway to South America team to learn about the best investment opportunities in the region. The company is a benchmark for foreign investors wishing to invest in Argentina, Brazil, Chile, Paraguay, Peru and Uruguay, providing expert advice on property acquisition and investment tours.

The Gateway Team – When You are Serious About Property

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