Argentine pulp maker blames Milei as it seeks bankruptcy protection

Pulp and paper manufacturer Celulosa Argentina SA filed for bankruptcy protection Monday, blaming the government of President Javier Milei for creating a bad business environment for local industry.

After missing bond payments, Celulosa, based in agricultural export hub Rosario, is now seeking protection from creditors in Argentina’s equivalent of a Chapter 11 process, according to an investor filing. Its locally traded shares slumped by as much as 17 percent on Monday and are down nearly 80 percent so far this year. 

Celulosa’s board explicitly pointed at Milei’s government for its troubles. 

“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 an “extremely adverse economic context.” 

Celulosa adds to Argentina’s worst wave of defaults since 2020. Several agricultural and industrial companies are struggling to adapt to a spike in borrowing costs, drastic spending cuts and a currency seen by many investors as overvalued, among other swift changes by Milei in the past two years. 

The libertarian leader faces a provincial election on September 7 and national midterms in October that will be a key test of voter support as the broader economy struggles take off.

Another of the companies that missed payments this year, oil producer Petrolera Aconcagua Energia SA, last week completed a US$220-million debt restructuring that paved the way for a takeover led by Vista Energy and trading house Trafigura.