Brazilian pulp exports to China at all-time high in 2023

The largest pulp exporter in the world, Brazil continues to post record highs in the planted forest sector. Last year, the country exported 18 million tonnes, considering all types of raw material, with almost half, or 49%, shipped to China. It was the largest purchase of Brazilian pulp ever made by the Chinese, both in volume and revenue.

In volume, Brazilian pulp shipments to China reached 8.9 million tonnes last year, generating $3.8 billion in foreign exchange. Of the total amount of fiber exported by Brazil, another 24% was shipped to Europe—which once was the largest market for the Brazilian product—and 14% to North America. The data was released by the Brazilian Tree Industry (Ibá), the association representing the planted tree production chain, in a bulletin with statistics for both the fourth quarter and consolidated year 2023.

According to Ibá, Brazilian pulp exports have doubled in the last 10 years and the sector currently accounts for the fifth item in the agribusiness export balance. “We have the challenge of maintaining and opening new markets. In addition, coordinating a new cycle of productivity growth for our planted trees,” said Paulo Hartung, Ibá’s executive president.

Brazil is expected to continue posting record highs in the industry in the coming years, in the wake of a robust portfolio of expansion projects not only in the pulp market but also in paper, wood panels, and forest planting. In the second half of the year, the sector had an investment portfolio of R$61.9 billion until 2028, of which R$22.2 billion was related to Suzano’s Cerrado project.

With 2.55 million tonnes of installed capacity, the company’s new plant, located in Ribas do Rio Pardo, Mato Grosso do Sul, will enter into operation by the end of June. The Cerrado project is expected to produce 900,000 tonnes this year, with sales of 700,000 tonnes. The volume will be exported, mainly to China.

The chart below shows Brazil’s export volume of pulp (hs 3912), measured in TEUs from Jan 2022 to Jan 2024. The data is from DataLiner.

Pulp Exports | Jan 2022 – Jan 2024 | TEUs

Source: DataLiner (click here to request a demo)

Chilean company Arauco is also investing in the sector in Brazil. Its first pulp plant in Brazil, in the city of Inocência, Mato Grosso do Sul, will receive R$15 billion in investments and could produce 2.5 million tonnes per year. The start of operations is expected for the first quarter of 2028, with a second stage of the project expected in the future.

Another Chilean company, CMPC, has just concluded an allocation of R$2.75 billion in the Guaíba plant, in the Porto Alegre Metropolitan Region, marking the second-largest private-sector investment ever in the state of Rio Grande do Sul. The BioCMPC project is aimed at updating the plant, expanding its production capacity, and making it more sustainable. In addition to the 18% expansion in pulp production capacity, or an additional 350,000 tonnes from 2024 onwards, the project will result in reducing costs and cutting greenhouse gas emissions.

In 2023, according to Ibá, Brazilian pulp production reached 24.3 million tonnes, slightly below the volume produced in the previous year. The drop was due to adverse market conditions, especially in the first half of the year, when international prices for eucalyptus pulp reached record lows.

In this scenario, Suzano, the largest pulp producer in the world, announced in June it would reduce its production volume by 4% relative to its production capacity—10.9 million tonnes of pulp by the end of 2022.

From January to September, the Brazilian fiber production totaled 18.1 million tonnes, down 2.8% year-over-year. Exports were 13.7 million tonnes, 3.6% lower, with apparent national consumption stable at 4.5 million tonnes.

Source: Valor International; translation by Liliana Hage

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