Pulp and paper manufacturer Celulosa Argentina SA has sought bankruptcy protection, citing the administration of President Javier Milei as responsible for fostering a detrimental business climate for domestic industry. Following the failure to meet bond obligations, Celulosa, located in the agricultural export center of Rosario, is currently pursuing creditor protection through Argentina’s version of a Chapter 11 procedure, as indicated in an investor filing.
The locally traded shares experienced a decline of up to 17 percent on Monday, bringing the total decrease to nearly 80 percent for the year to date. Celulosa’s board explicitly attributed its difficulties to Milei’s administration. “The deep changes that the national government has implemented in fiscal, monetary and currency policy create challenges that are still too difficult for us to overcome,” according to the company filing citing meeting minutes, which earlier described a “extremely adverse economic context.”
Celulosa contributes to Argentina’s most severe wave of defaults since 2020. Numerous agricultural and industrial firms are facing challenges in adjusting to increased borrowing costs, significant reductions in expenditure, and a currency perceived by many investors as overvalued, alongside other rapid transformations implemented by Milei over the past two years.
The libertarian leader is set to confront a provincial election on September 7, followed by national midterms in October, which will serve as a crucial gauge of voter support amid the ongoing challenges in the broader economy. Another company that failed to meet its payment obligations this year, oil producer Petrolera Aconcagua Energia SA, last week finalized a US$220-million debt restructuring, facilitating a takeover spearheaded by Vista Energy and trading house Trafigura.