Uruguay is the fourth-largest producer of wine in South America, with a production of 67,000 tonnes and 8,023 hectares (19,830 acres) of vineyards in 2012. Its signature wines are that of red wines produced from Tannat grapes.
The modern wine industry in Uruguay dates back to 1870, and the wine industry was started by immigrants of mainly Basque and Italian origin. In 1870, Tannat was introduced to the country by Don Pascual Harriague, a Basque.
When the Mercosur free trade association started to take shape in the late 1980s, Uruguay took steps to increase the quality of its wines and stepped up its marketing efforts, due to fear of being out-competed by Chilean wines and Argentine wines, which had lower production costs.