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Forestry industry expands investments in Brazil
[Jun 13, 2024]

Much of the Brazilian pulp and paper production is focused on export

The forestry sector in Brazil is expected to invest around R$90 billion by 2028, according to the president of the Brazilian Tree Industry (Ib¨¢) and former governor of Esp¨ªrito Santo, Paulo Hartung. The figure is higher than the organisation's previous official projection, which expected investments of R$62 billion over the same period.

According to Hartung, the segment has been experiencing a phase of growth, with several recent announcements of expansion projects and the opening of new factories across the country.

According to Hartung, the estimate is preliminary and Ib¨¢ is expected to release finalised investment figures from the end of June. He says that the forestry sector's growth is driven by the fact that there will be a structural expansion in the consumption of wood derivatives in the packaging and hygiene products markets.

This development contrasts with the difficulties faced by other industries, such as steel and chemical products.

The segment's differential, according to Hartung, was the understanding on the part of companies that Brazilian production should be dedicated to exports. This has made the country's market more competitive compared to other sectors, turning Brazil into the largest pulp exporter in the world and the second largest producer, behind only the United States.

"We're inaugurating a new mill every year and a half and, as we go along, there are expansions of the preserved areas," says Hartung.

The sector was already booming in the country, but has been hit by a series of new investment announcements in recent weeks. Among them, the highlights are Chilean companies Arauco and CMPC, both of which announced the installation of new factories with figures of around R$20 billion for each project.

Bracell, owned by the Asian group Royal Golden Eagle (RGE), is also planning to expand its pulp operations in Brazil, but has not announced the value of the investments, although market estimates project contributions of around R$1 billion.

There is also the possibility that Paper Excellence, owned by Indonesian businessman Jackson Wijaya, will invest around R$20 billion in setting up a new pulp mill in the country, although talks on the subject are still ongoing.

The multinational is facing legal imbroglios over control of Eldorado with the Brazilian group J&F, but the dispute has not reduced the Indonesian group's interest in continuing to invest in the Brazilian forestry market. (Estadão Conte¨²do)

Source:  jornalcruzeiro.com.br