Appraisal of the food processing industry of Uruguay; agro-industrial subsector assessment and demand analysis

URUGUAY HAS A LARGE UNREALIZED POTENTIAL FOR AGRICULTURAL PRODUCTION. LESS THAN ONE PERCENT OF THE AGRICULTURAL LAND IS USED FOR FRUIT AND VEGETABLE GROWING; THERE ARE LARGE OPPORTUNITIES FOR EXPANSION. MOST OF THE FRUIT AND VEGETABLES ARE GROWN ON SMALL FARMS OF LESS THAN 50 HECTARES. ALTHOUGH URUGUAY IS VIRTUALLY SELF-SUFFICIENT WITH RESPECT TO FOOD PRODUCTION AND IS EXPORTING SIGNIFICANT QUANTITIES OF NON-TRADITIONAL FOODSTUFFS, THERE IS CONSIDERABLE SCOPE FOR IMPROVEMENT IN PRODUCTION EFFICIENCY AT THE FARM LEVEL. THE CONSTRAINTS UPON INCREASING AGRICULTURAL OUTPUT AND EXPORTS ARE SMALL FARMS, POOR FARMERS LACKING IN CAPITAL, POORLY ORGANIZED FARMS, LACK OF MOTIVATION FOR INCREASING PRODUCTION, AND LACK OF AN ORGANIZED MARKETING CAPACITY. STEPS ARE BEING TAKEN BY FRUIT AND VEGETABLE PROCESSORS TO ENCOURAGE INCREASED PRODUCTION UNDER CONTRACTS SUPPLYING TECHNICAL FIELD SERVICES, SEEDS, AND FERTILIZERS. DAIRY INDUSTRIES ARE ALSO IMPROVING MILK HANDLING AND ARE INSTITUTING A BONUS SYSTEM FOR DAIRY FARMERS. SINCE 1970 FRUIT EXPORTS HAVE INCREASED FROM U.S. $749,000 TO U.S. $4,440,000 IN 1974, AND OUTPUT CAN BE QUICKLY INCREASED BY BETTER ORCHARD MANAGEMENT AND IMPROVED TECHNIQUES. NO LABOR PROBLEMS ARE ANTICIPATED. MOST FRUIT AND VEGETABLE PROCESSING PLANTS ARE POORLY EQUIPPED, BUT CONAPROLE DAIRY PLANTS ARE EXCELLENT IN ALL RESPECTS. FRUIT AND VEGETABLE PROCESSORS ARE IN NEED OF INVESTMENT PROGRAMS TO IMPROVE CAPACITY, EFFICIENCY, AND QUALITY.