Livestock will remain the dominant sector in Uruguayan agribusiness out to 2021 as the boomin soybean plantings will wane on the back of lower foreign investment. Both sectors will remain focused onthe export market where Uruguayan producers will continue to find solid opportunities. Domesticconsumption will remain strong for beef and subdued for soybean.
Soybean production growth from 2015/16 to 2020/21: 1% to 2.7mn tonnes. After a sharp drop in2016, the pace of soybean acreage expansion will slow considerably over the next five years. The reasonfor the large downgrade in growth is base effects.
Beef production growth from 2015/16 to 2020/21: -1.7% to 577,000 tonnes. Beef production willcontract by an average of 3.5% per year between 2017/18 and 2018/19, as cattle producers will aim togrow their herds in response to higher prices for feeder cattle relative to slaughter (fed) cattle. Weforecast a return to positive growth in 2019/20 and 2020/21. Moreover, cattle production will likelyregain some territory over soybean in the country's central and northwestern areas, two traditional cattleregions, which will provide additional incentives for cattle ranchers to increase their animal numbers.