We analyze the impact on welfare of an increase in commodity prices in Uruguay.Given that this country has a large share of households with low and medium-lowincome, a positive shock on commodity prices has the potential to hurt asizable part of the population through the rise in the cost of the consumption basket.However, the pass through on domestic prices would be alleviated by positive changesin labor income that middle-income households experience as the wages alsorespond to hike of international commodity prices. We find that in Uruguay householdsat the upper end of the distribution would benefit with the increase of theinternational prices of agricultural commodities, with low-income households losingas much as 7.5%. In terms of poverty, the increase would be 34%, while increasesin indigence would be lower: 19%. Also, the results show that households in asituation of indigence and/or poverty, would move in average further away from thethreshold lines, meaning that within each category, poor and indigent householdsbecome more homogeneous among them.