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Solidwood exports face worsening prospects

Gazeta Marcantil/Celulose Online has reported that the solidwood industry in Brazil is being crippled by the impact of the United States housing crisis since early this year. Official statistics indicate that exports of solidwood products may show their worst result since 2004. The outlook for 2009 is not optimistic because some mills have been already closed or industrial production of some companies has decreased dramatically.
The shrinkage of US imports has occurred since 2006. The US share in Brazilian solidwood products exports, which reached 42% in 2006, decreased to 30% in 2007, and in 2008 is expected to fall to 24%. In 2009, a further market adjustment will likely occur. Many companies may phase out their production, but capitalised mills investing in new technology are expected to grow.
According to the Brazilian Silviculture Society (SBS), log production from planted forests in Brazil was 156 million m³ in 2007, and 50 million m³ from natural forests. The total revenue of the forest sector, including charcoal and pulp, was US$37 billion, out of which US$8 billion was from exports. Log production was expected to be repeated in 2008 and there was no clear forecast for 2009.
The difficulties in exporting faced by the forest sector have been observed at least for three years due to the sharp depreciation of the US currency. To some extent, the domestic sales to the civil construction industry have helped counterbalance shrinking exports. – Tropical Timber Marker Report.