Domestic timber demand on the rise in Brazil

Research has shown that domestic demand for timber in Brazil is on the rise, along with costs.

The Wood Resource Quarterly (WRQ) paper showed that in US dollar terms, pine sawlog prices in Brazil fell by 22 per cent over the course of a year. However, when prices were assessed in the local currency, they were shown to have steadily increased and actually hit their highest levels in over four years in the second quarter of 2012.

An increasingly competitive edge across the international market and a weakening currency helped the Brazilian forestry industry to grow stronger as domestic demand pushed up log prices. This is expected to continue for sometime and market participants are predicting that exports of lumber, plywood and value-added products will increase in the coming months.

However, at the moment, US dollar comparisons mean that Brazilian pulpmill wood costs are currently among the lowest of all regions tracked by the WRQ. Eucalyptus pulplog prices were also found to have fallen 28 per cent in the second quarter of 2012 compared to the same period last year, while pine pulplog prices were down 26 per cent.