Finland’s UPM inaugurated its second plant in Uruguay

The company completed the most significant productive investment in the history of Uruguay with the inauguration of its new pulp mill Paso de los Toros.
Publication date: 07/06/2023

The Finnish company UPM inaugurated its second pulp mill -Paso de los Toros- in the town of Centenario, in the department of Durazno. This new facility required an investment of US$ 3.47 billion.

In the presence of hundreds of guests, which included Uruguayan authorities, business people, and the media, the chairman of UPM’s board of directors, Henrik Ehrnrooth, described Uruguay as a reliable country to do business with.

The President of Uruguay, Luis Lacalle Pou, celebrated the inauguration and reviewed several milestones in the country’s history which, he said, led to the realization of UPM’s historic investment: the intervention of different governments to promote the forestry chain, the port law and the investment protection treaty with Finland, among others.

“What seems obvious to us in the world generates confidence. There may be changes made by the government, but the Constitution, the laws, and the contracts will always be respected in Uruguay. Uruguay has a track record and a tendency to be accompanied by successful companies”, said the President.

UPM Paso de los Toros is the largest productive investment in Uruguay’s history

The Uruguayan Minister of Industry, Omar Paganini, highlighted the historical vision of the Uruguayan government and the private sector, which was in charge of promoting the arrival of international investments in a territory suitable for cultivating eucalyptus.

In this sense, he highlighted institutional conditions such as full democracy, respect for the commitments and contracts assumed as well as political and social stability. He considered these aspects of Uruguay were vital in attracting the most significant productive investment in the country.

Paganini highlighted the importance of the Uruguayan forestry-industrial chain, which is an example of sustainability and environmental care with international certification, state-of-the-art technology, and international insertion.

UPM’s new mill will produce 2.1 million tons of pulp annually by consuming 7 million cubic meters of wood—the project positions Uruguay to be among the leading global exporters of pulp in the market.

It is designed to send its production by rail to UPM’s specialized terminal, located in the port of Montevideo. After that, the production will then be loaded onto transoceanic ships bound for Europe and Asia.

The project generates 7,000 direct and 10,000 indirect jobs through jobs in the value chain (more than 20,000 Uruguayans participated in the construction) for 600 small and medium-sized companies. It will redistribute US$ 290 million in net annual salary, creating a 3.4% impact on the gross domestic product (GDP) with the growth of operations. It will also enable the country to reach US$ 1.9 billion in exports of its products per year.