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Growth opportunity with a new pulp mill


Demand for sustainable eucalyptus pulp continues to grow. UPM has today made the investment decision to construct a 2,1 million tonne greenfield eucalyptus pulp mill near Paso de los Toros in central Uruguay. The mill investment of USD 2,7 billion will result a step change in the scale of UPM’s pulp business. UPM will invest USD 350 million in port operations in Montevideo and local facilities in Paso de los Toros. The safety and sustainability performance of the value chain from plantations to customer delivery is expected to be on an industry leading level.

The prerequisites for the investment have been carefully prepared in cooperation with the state of Uruguay. For Uruguay, the project and the infrastructure development offer significant opportunities for economic and social development.


UPM continues its strategic transformation and invests in a world class pulp mill in central Uruguay


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Impacts of a new pulp mill to Uruguay

The indicative figures are based on economic impact studies by CPA Ferrere and Deloitte, in May 2016 and July 2019.



10,000 new jobs
throughout the value chain
MUSD 200 in salaries
annually throughout the value chain
​MUSD 170 tax collection
annually throughout the value chain



Exports of MUSD 1,100
representing +12% increase
Permanent increase of approx.
2% of GDP
small and medium sized local enterprises

Impacts to central and north-eastern region


Training and education
for permanent jobs
New skills and opportunities
for people in rural areas
Inland agri-businesses
closer to Montevideo port



Concrete tools and best practices to
improve environmental awareness
Possibility for
practical and sustainable actions
around the Rio Negro basin



Infrastructure development as an enabler

Robust infrastructure is the foundation for industrial development. The Government of Uruguay will develop the country’s inland rail and road network that will enable new business opportunities, such as cost-efficient transportation of pulp, grain, wood products and containers.

Often considered the safest and most environmentally friendly form of heavy transport, railway offers a competitive alternative for all its users.

UPM’s products would provide the base volume for the rail. Like all users, UPM would pay for the use of the railway.



  • Improvements and maintenance to allow year-round use
  • Efficient wood transportation with combined high performance vehicles


  • Modernisation to meet the latest standards
  • Accessible for public and private operators


  • Deep sea port of Montevideo to be suitable for fully loaded ocean vessels
  • Railway connection to the port

Creating permanent positive impact with a new pulp mill

Current UPM operations


Growth opportunity



UPM's state-of-the-art pulp mill

USD 2,7 billion
2,1 million tonne
annual capacity of eucalyptus market pulp




​The preliminary investment estimate for the pulp mill construction on site is USD 2,7 billion.

The single line pulp mill with proven environmental performance and best available techniques (BAT) will have a production capacity of approx. 2,1 million tonne of eucalyptus market pulp annually. This will make it the largest single line pulp mill in the world.

The pulp mill will be located in the department of Durazno on the southern side of the river Rio Negro, 4–5 km downstream from the city of Paso de los Toros and Centenario village.



In addition to the initial on-site investment, a successful project requires off-site investments

  • Plantation land, forestry, nursery capacity
  • Harvesting and transport equipment
  • Road network for forestry operations
  • Wood transportation contractor network
  • Training
  • Rolling stock for rail
  • Electricity infrastructure
  • Export facilities

UPM’s process for the new pulp mill consist of three phases

Environmental and Social Impact Study




UPM Uruguay

Av. Italia 7519 Piso 2
Edificio Blue, Art Carrasco Business
11.500 Montevideo


Phone: (+598) 2604 6660
Fax: (+598) 2604 5406