"If Iran is willing to barter oil for rice we will do it and we will take out currency from (the operation)," said Agriculture Minister Tabare Aguerre.
Uruguay is a key exporter of rice in Latin America and the seventh largest supplier in the world.
Before the US sanctions against Iran were put in place Iran was the largest consumer of rice from Uruguay. The United States has warned that it could slap sanctions on countries that buy crude from Iran.
Uruguay's enthusiasm and readiness for new forms of oil deals with Iran in defiance of the United States' extraterritorial laws is more interesting when remembering that the country is viewed as a US ally in Latin America.
Uruguay exported 90,000 tons of rice to Iran in 2011.
Since taking office in 2005, President Ahmadinejad has expanded Iran's cooperation with many Latin American states, including Venezuela, Bolivia, Cuba, Ecuador and Brazil.
The strong and rapidly growing ties between Iran and Latin America have raised eyebrows in the US and its western allies since Tehran and Latin nations have forged an alliance against the imperialist and colonialist powers and are striving hard to reinvigorate their relations with the other independent countries which pursue a line of policy independent from the US.
In January, Iranian President Mahmoud Ahmadinejad went on a four-leg tour of Latin America, where he expressed his pleasure in seeing the common positions of Iran and Latin American states on different international issues.
Addressing a press conference upon his arrival from the tour, Ahmadinejad stated that the Islamic Republic is on the same front with most Latin American countries in the campaign against hegemony and injustice.
He lauded the close ties between the two sides, and noted, "Iran's relations with Latin America are very good, expansive, and strategic, and the country's interactions and transactions with all the countries of this region are increasing and deepening."
The tour of Latin America took the Iranian president to Venezuela, Nicaragua, Cuba and Ecuador, where all the countries' leaders reiterated their support for Iran's right to access peaceful nuclear technology and defended Tehran against the threats and pressures exerted by the US-led West.
Iran has done a raft of deals in Latin America nations ranging from housing construction agreements with Venezuela to financing for Cuba's purchases of Iranian-made train cars.