At MonteClaro we adopt a business approach and a code of good agriculture and livestock practices that is based on our local knowledge and personal experience in the areas where the operations are being conducted.
The family group has been settled for generations in the region where the agriculture and livestock operations take place and owns land properties in those areas. Read more about the Ramos Mejia family and Gutiérrez and Herrera family.
We, therefore, have a srtaight forward interest in the conservation of soil fertility and in improving farmland productivity in the long run, as well as in the respect for the environment and the improvement of educational and social conditions of the surrounding communities which are a very important part of our human capital stock.
We apply our know-how to maximize results without damaging the environment, we transfer technology and knowledge to local populations and educate our employees and contractors on the use of new technologies and the values of work ethics. Our business approach is based on five (5) cornerstones:
1) Diversification of market risks: Our goal is to funnel investments into the most productive, efficient and competitive sector of South America by providing large, medium and small investors of the cities with the opportunity to participate in a business that was once reserved mostly for ranchers and farmers. A well balanced investment portfolio has investments in the "real world".
2) Investments linked to international markets: Investments are made in sectors with a revenue stream depending on international markets and international demand rather than domestic consumption.
3) International law protection: Agribusiness investments are structured under private trust, funds or other contractual and corporate vehicles as appropriate, to ensure confidentiality and investor rights over the land, livestock or crops in which they invest their money. Given the international nature of our business, investments are structured through contracts subject to international law, such as the law of New York or the law of Uruguay, limiting legal risk and avoiding the application of domestic public policy rules that investors may fear.
4) Diversification of production risks: The production risk can be diversified between different countries and between different businesses by investing in crops, livestock and land. In addition, the production risk is generally shared with the operator, which has its income linked to the performance and in some cases guarantees certain minimum yields with its management fees and provision of inputs.
According to High Quest "an increasingly common business model is the formation of equity partnerships where the farmer provides the skills and outside sources and investors provide the working capital. Such partnerships divide the land ownership from the farming business and allow each party to drive their operation separately".
5) Care for the land and the environment, innovation and human capital development
a) No till sowing and crop rotations: In agriculture, we have been pioneers of no till sowing in northern Uruguay, thereby reducing environmental concerns associated to land erosion and improving soil fertility in the long term. We use no till sowing equipment that only cuts the surface of the soil, where de seed goes and is immediately closed. This technique allows better moisture retention, reduces the loss of soil nutrients and diminishes the need for agrochemicals.
We also give special importance to crop rotations, so that different crops planted each time contribute nutrients to the soil that were absorbed by the preceding crops and provide greater residue cover. That cover serves as humus to the soil, preventing exhaustion or gradual desertification of soils by the continued use of a monoculture. The process is also complemented with periods in which land is left fallow or is used in rotations with pastures for livestock, enabling increased soil fertility and reducing the application of agrochemicals. Crop rotation also provides greater stability to the business as different crops achieve diversification of productive and market risks.
For example, the cultivation of rice in Uruguay is based on a production system of low-intensity pasture rotations integrated with livestock production. These characteristics give the rice sector the ability to leverage these comparative advantages and differentiate within the region. In Uruguay, 60% of the crop is done on natural grasslands or after several years without rice and only 40% is planted on the rice stubble of the previous year. In many cases, the fields are not cultivated for a period of four to six years. This production system, coupled with high quality seed used by farmers, gives rice a high sustainability, with low use of herbicides and fertilizers. It also allows a limited use of insecticides. This virtually unique productive reality in the world is perhaps one of the greatest strengths of the Uruguayan production system, at a time when the world is giving increasing importance to the conservation of the environment and food security.
b) Development of irrigation systems and efficient use of fresh water: We are pioneers in the development of irrigation systems for soybeans in Uruguay, especially in the north where we have been working closely with the National Agriculture Research Institute of Uruguay (INIA) in irrigation systems, surface and center pivot. In Uruguay dams to store rainwater that is otherwise lost are used to irrigate crops. In Paraguay, in the Chaco region, Australian artesian wells are used to collect rainwater in the rainy season, which is stored so that livestock have enough during the dry season.
c) Livestock production at grasslands with proper disease control: The livestock production systems that we operate are primarily based on breeding and fattening at grasslands. This system gives cattle a natural and healthy muscle growth which can be noticed in the taste of the meat that made Argentina’s beef famous worldwide. The same is true for Uruguay and Paraguay to the extent that they use similar production systems and have incorporated Argentine livestock genetics through artificial insemination. Depending on market conditions, livestock may be finished at a short term feed-lot not lasting more than 100 - 120 days.
Raising livestock at natural grasslands has a lower risk of disease associated to excessive use of artificial feed supplies. The risk of mad cow (BSE) is neligible. Under grass production systems that we operate livestock have abundant availability of water and fodder, that they have shade in summer and are naturally protected from the harsh winter weather. All that, coupled with adequate veterinary control, a vaccination calendar program to prevent diseases and the provision of vitamin and mineral supplements.
d) Transfer of technological knowledge: A key condition for country development and for business success as well is human capital. In our own interest, in the interest of the country and also moved by a Christian inclination, we promote the transfer of know-how and knowledge to the employees and contractors we work with.
e) Ecology and wildlife reserves: Where cleaning the natural forest is necessary, we meet international standards for the protection of wildlife and natural vegetation, leaving significant areas as ecological reserves and corridors for native species to develop their potential and move freely.