Monday, July 14, 2014

Uruguay: Chile's Arauco, Swedish-Finnish-Owned Sora Enso to Generate US$844 Million to gdp

According to The Latin American Tribune, the Montes del Plata paper plant, owned by Chile’s Arauco and Swedish-Finnish firm Stora Enso, the construction of which was the largest private investment project in Uruguayan history, on the weekend sent its first export shipment to Asia, company executives said on Sunday (July 13).

Construction began on the plant in mid-2011 and it was finished in April 2014. In early June, it received its final environmental authorizations and two weeks ago it began producing cellulose paste.

The first export shipment of cellulose was for 21,000 tons and was sent to several Asian nations.

The paper plant, located in the Punta Pereira zone in Colonia province on the Rio de la Plata, will produce 1.3 million tons of cellulose per year from eucalyptus fiber coming from its plantations in 11 of the country’s 19 provinces.

COMMENT: The project – which includes the cellulose plant, a power generation unit using bio-mass and a port through which to export the cellulose and receive supplies--required an investment of some $2 billion.

The company forecasts that the industrial complex will contribute $844 million to Uruguay’s gross domestic product, although their press release did not clarify when that would occur.

Besides Montes del Plata, Uruguay also has another cellulose plant in operation, this one owned by the Finnish firm UPM and located on the bank of the Uruguay River, which forms the border with Argentina.

The authorization to increase production at the UPM plant to 1.3 million tons per year a few weeks ago revived a bilateral conflict between Uruguay and Argentina.