The South American Pulp and Paper Industry: The Cases Brazil, Chile, and Uruguay

This chapter discusses the evolution of the South American pulp and paper industry (PPI), emphasising Brazil, Chile and Uruguay. The analysis is mainly based on secondary sources and demonstrates how the industry has evolved from its establishment to its

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The South American Pulp and Paper Industry: The Cases Brazil, Chile, and Uruguay Maria Barbosa Lima-Toivanen

10.1

Introduction

Compared to the history of the pulp and paper industry (PPI) as discussed in other chapters of this book, the history of the PPI in South America is relatively short. It dates only as far back as the mid-twentieth century. The importance of this history resides in the emergence of the region as a world class manufacturer of high-quality, mostly hardwood pulp from Eucalyptus, and through very productive cultivation standards and leadership in costs and productivity. As a market for paper products, the population of about 386 million inhabitants of South America does not yet consume as much paper per capita as in developed countries. There is still important room for growth. As a space for production, the location in the Southern Hemisphere provides good climatic conditions enabling faster forest growth rates than in Northern Hemisphere, which benefits pulp production. Investments in technology to achieve higher yield from, mainly, eucalyptus plantations is one of the main reasons to get to know the evolution of the industry. Three countries, Brazil, Chile, and Uruguay, especially have invested in the industry and are worth discussing in more detail. The analysis of the PPI evolution in these three countries is justified for they are successful cases, different from other countries in the region, which potentially have the same comparative advantages, such as similar natural resources, as Argentina, Colombia, and Venezuela (Katz et al. 1999). The knowledge about South America’s natural comparative advantages for the growth of plantations to supply wood for pulping is widespread. Brazilian and

The author would like to thank the Brazilian Pulp and Paper Technical Association (ABTCP) for allowing virtual access to its Nucleus of Technical Information and Risi Info for the sharing of data on countries outputs, though these institutions are not liable for the use of any of the information they have provided or allowed access to. M.B. Lima-Toivanen (*) VTT – Technological Research Centre of Finland, Espoo, Finland e-mail: [email protected] J.-A. Lamberg et al. (eds.), The Evolution of Global Paper Industry 1800–2050: A Comparative Analysis, World Forests 17, DOI 10.1007/978-94-007-5431-7_10, © Springer Science+Business Media Dordrecht 2012

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Chilean pulp and paper producers are among the most profitable companies for using fast-growing eucalyptus trees, and Brazilian companies have become global cost leaders in the production of market pulp (Gurlit et al. 2007) for their productivity. Nevertheless, it will be wrong to consider that only the exploitation of natural advantages is to be credited for the success of PPI in these countries, in Brazil especially. Leading companies have played an important role by exploiting economies of scale and increasing the technological advances of their production, helped by pioneering improvements from the research insti