There has been a marked increase in the demand for timber in Brazil, driving up local timber prices, according to Forestry Research Associates (FRA).
The research and analysis consultancy was responding to the recent figures published by Wood Resources Quarterly. The figures show that the investment in housing and infrastructure in Brazil is resulting in major growth in the timber industry, with more and more timber being required for construction, energy and charcoal purposes.
In addition to the local demand, the fact that the Brazilian real has been losing value has meant that Brazil’s own timber and timber products are growing in popularity abroad, leading to more exportation of Brazilian-sourced timber.
“The vital part in all of this,” claims FRA’s analysis partner, Peter Collins, “is that the timber being used at home and exported abroad is sustainably sourced.
"It would be a tragedy if the demand led to more deforestation in the Amazon, for example."
FRA is now calling for more investment in Brazilian plantation projects, such as those run by Greenwood Management, which manages fast-growing, non-native species of tree in sustainable forestry plantations for use in construction and charcoal production.
What’s more, those who invest in this type of plantation will see healthy returns as demand for timber increases and prices grow in response. Although the price being paid for timber and products like Pulpwood are coming down from a US dollar perspective, the real’s value has dropped, which means the prices being paid locally are actually increasing significantly and have been for some time.
“It’s a great time to invest in managed forestry in Brazil," claimed Mr Collins. He added, “market conditions are looking strong and for alternative investors, timber offers a prefect mix of returns on investment and ethical credentials, which makes it an attractive choice for many following the economic crisis."
Forestry Research Associates
620 Vineyard Lane
Bainbridge Island, WA 98110
(206) 316 8394