The Annual Plan for Forest Concession (PAOF) 2010, which defines the concession areas for sustainable harvesting was signed in Brasilia by the Minister of Environment, reported MMA/ASCOM. The measure will contribute to revenue generation of nearly BRL430 million to both the government and the industry - in addition to 12,000 direct and indirect jobs. Until now, some 90,000 hectares in the country had been auctioned within a single Conservation Unit, the Jamari Flona (National Forest) in the Northern state of Rondônia. According to SFB, the concessions will expand the sustainable forest area for harvesting and provide an opportunity to the timber sector to purchase legal products.
To the Ministry of the Environment (MMA), the creation of sustainable economic activities is an important alternative to combating deforestation, since the supervision of forest management and penalties for inappropriate harvesting are not sufficient to control the destruction of the forests.
This year, nearly 1 million hectares will be offered for bidding in three auctions. One has already opened, the Saracá-Taquera Flona, which covers 140,000 hectares. Later this year, auctions of the Amana and Crepori National Forests, in the state of Pará, will be announced. Among the possible buyers of the concessions are companies that consume wood raw materials, forest service providers, machinery companies, equipment and forest suppliers and communities living around the concession areas.
Minas Gerais’ stands to gain from federal programme
Even with the slowdown of furniture sales in the first half of 2009, the Minas Gerais’ furniture sector foresees a promising year, reported O Tempo. Compared to 2008, a 7% growth in revenue amounting to BRL190 million is expected in 2009. Additionally, with the completion of the first house under the federal programme ‘My House, My Life’ in 2010, the prospect for increased sales in such homes is 30%, according to the Ubá Inter-Municipality Union of Furniture Industry (INTERSIND).
The Union represents 400 furniture companies in the regional cluster. It expects domestic sales to expand next year and have a positive impact on revenues from investments in the real estate market. In the first half of 2009, furniture exports fell 50% compared to the same period of 2008. With the slump in exports, especially due to the global economic crisis, the industry is increasingly targeting the domestic market. The ‘My House, My Life’ programme is expected to boost sales, as those who buy new homes also need new furniture.
According to the Minas Gerais Furniture Merchants and Representatives Association, furniture sales in the first two months of 2009 were low as result of consumers’ limited interest in purchasing home furniture. To avoid the worst, companies worked to maintain minimum sales. As the crisis appears to be coming to an end, companies need to continue their work, considering that the domestic market is expanding and offering an opportunity to grow.
Exports of Brazilian solidwood products tumble amid global financial crisis
Brazilian exports of solidwood products have been declining since 2007, and the situation has become even more serious for the sector since the beginning of the financial crisis. According to Agência Brasil / O Liberal, the crisis has affected exports from traditional solidwood producing regions in Brazil. According to the Paraná Wood Industry Union, in the first six months of 2009, solidwood exports from the country fell 43% by volume compared to 2008. In Paraná, the fall in sales in the last 20 months was 54%, which included lumber, pine and tropical plywood, door and solidwood product sales from other segments. The state employs about 600,000 workers in the timber industry comprising 1,200 companies affiliated to the Union. As companies have made adjustments following the financial crisis, nearly 6% of the workers have been laid off in the first half of the year.
In the Northern state of Pará, exports of solidwood products in the first half of 2009 plummeted 52.9% by value compared to the same period of 2008, according to the Pará Timber Exporters Association (AIMEX). Although exports by volume rose 1.7% from May to June 2009, the devaluation of the Brazilian real against the US dollar hurt producers, with revenues dropping 2.3% over the period, resulting in a loss of nearly USD 660,000.
The main factors contributing to the poor performance of the industry are high tax burdens; low demand from external markets; fierce competition with other tropical countries such as Malaysia and Indonesia; high interest rates for small and medium producers; and the fluctuation of exchange rates. The recovery of timber exports, according to AIMEX, is expected to occur from October 2009. The expectation is that the crisis will start to slowdown and the civil construction industry abroad will strengthen, consequently improving prospects for exports of Brazilian solidwood products.
High costs deter forest product certification
Although it has become a condition for some companies to access external markets, certification of wood and nonwood products is still resisted by some small and medium sized companies, reported Folha de São Paulo. As observed by the Forest Stewardship Council in Brazil, companies’ reasons for not certifying include the high cost of certification and the process of compliance with environmental and labor standards.
At times, the costs for adjusting forest management areas and chain of custody are higher than the cost of certification itself. Nevertheless, the Brazilian companies that do invest in certification confirm having benefited from greater opportunities to exports.
In addition, the INMETRO (The National Institute of Metrology, Normalization and Industrial Quality) also certifies forest companies that operate in a sustainable way. The CERFLOR (Brazilian Program of Forest Certification) was established in 2002 by INMETRO under which more than 1 million hectares of natural and planted forests nationwide have been certified.
| Brazilian logs, mill yard, domestic | US$ per m3 | ||
| Ipê | 131 | ||
| Jatoba | 93 | ||
| Guariuba | 62 | ||
| Mescla (white virola) | 68 | ||
Brazil Sawnwood Prices
| Sawnwood, Belem/Paranagua Ports, FOB | US$ per m3 | ||
| Jatoba Green (dressed) | 781 | ||
| Cambara KD | 456 | ||
| Asian Market (green) Guariuba | 259 | ||
|
Angelim pedra
|
590 | ||
|
Mandioqueira
|
227 | ||
| Pine (AD) | 189 | ||
| Brazil sawnwood, domestic (Green) |
US$ per m3
|
||
| Northern Mills
(ex-mill) Ipe |
613 |
||
|
Jatoba
|
471 | ||
| Southern Mills
(ex-mill) Eucalyptus (AD) |
170 | ||
|
Pine (KD) 1st grade
|
220 | ||
Brazil Veneer Prices
| Veneer, FOB (Belem/Paranagua Ports) | US$ per m3 | ||
| White Virola Face 2.5 mm | 290 | ||
| Pine Veneer (C/D) |
205 | ||
| Rotary cut
Veneer, domestic |
US$ per m3 | ||
| (ex-mill Northern Mill) |
Face Core |
||
| White Virola |
229 192 | ||
Brazil Plywood Prices
| Plywood, FOB |
US$ per m3 | ||
| White Virola (US Market) | |||
|
5.2 mm OV2 (MR)
|
455 | ||
|
15 mm BB/CC (MR)
|
393 | ||
| White Virola (Caribbean Market) |
|
||
|
4mm BB/CC (MR)
|
498 | ||
|
12mm BB/CC
|
399 | ||
| Pine
Plywood EU market, FOB |
US$ per m3 | ||
| 9mm C/CC (WBP) |
265 | ||
| 15mm C/CC (WBP) |
242 | ||
| 18mm C/CC (WBP) |
237 | ||
| Plywood,
domestic (ex-mill
Southern mill) |
US$ per m3 | ||
| Grade MR (B/BB) White
Virola 4mm |
786 | ||
|
White Virola 15mm
|
575 | ||
| Domestic prices include taxes and may be sbject to discounts. | |||
Other Brazil Panel Prices
| Belem/Paranagua Ports, FOB | US$ per m3 | ||
| Blackboard Pine 18mm 5 ply (B/C) | 309 | ||
| Domestic
Prices, Ex-mill, Southern Region |
|||
| Blackboard White Virola faced 15mm |
503 | ||
| Particleboard 15mm |
322 |
||
Brazil Added Value Products
| FOB Belem/Paranagua Ports | US$ per m3 | ||
| Edge Glued Pine Panel | |||
|
Korean
market (1st grade)
|
631 |
||
|
US Market
|
482 | ||
| Decking Boards Cambara |
591 |
||
|
Ipê
|
1533 | ||