world news - 14.05.2003
Rising Brazilian Exports. In the first quarter of 2003, Brazilian tropical sawnwood exports reached US$ 83.4 million, 15.3% more than in the same period of 2002 (US$ 72.4 million). However, the volume exported was 33.9% higher.
Analysts in Brazil are saying that those mills depending on the country's s pine log supplies may be at risk because demand is outstripping the sustainable production capacity. In 2003, for example, there will be an 11.3 million cubic metre pine log deficit. This deficit tends is likely to grow bigger and, by 2020, it could reach more than 27 million cubic metres.
Brazil is known for offering some of the lowest log prices in the international market. But pine prices are tending to become higher than those offered by suppliers in Chile and New Zealand. This trend is likely to worsen since domestic pine supplies will not increase in the short or medium term, and investments in reforestation, a long-term solution, are low.
Brazil, unlike its Mercosur partners (Argentina, Paraguay and Uruguay), does not have any incentive mechanisms for forest planting. For these reasons, Brazilian forest sector competitiveness runs of being put at risk. Government proposal to offer credits for reforestation in small forest properties (Pronaf) are not considered adequate by some local analysts to prevent a worsening pine log shortage.
The timber sector is calling for fast and efficient government action to support the private sector to avoid Brazil having to import even more wood than is currently being supplied by Argentina and Uruguay.
In recent news BRDE (Banco Regional de Desenvolvimento do Extremo Sul), which is a regional development bank in southern Brazil, has just approved a new operational policy aimed at stimulating forest planting for industrial purposes.
The bank is offering long-term financing at low interest rates. Companies of any size, associations, and rural producer cooperatives, as well as individuals working in the agricultural sector may present projects to BRDE. These projects must be submitted under the technical guidance of licensed professionals and have to meet standards of the Brazilian Environmental Legislation and Forest Law. Interest rates for this incentive are in the region of 8.75%.
As for pine sawnwood exports, these jumped to US$ 66.9 million, 8.9% more than in the same period of 2002 (US$ 61.5 million). This increase in exports and gain in international market share for both tropical and pine sawnwood stems mainly from the strong Real devaluation at end of 2002.
See also:
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