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TRENDS IN BRAZIL ’S PRODUCTION AND INTERNATIONAL TRADE

TRENDS IN BRAZIL ’S PRODUCTION AND INTERNATIONAL TRADE. ITTO MARKET DISCUSSION. Ivan Tomaselli www.stcp.com.br. Libreville - Gabon | November, 2013. CONTENTS. FORESTS AND RAW MATERIAL SUPPLY INDUSTRIAL DEVELOPMENTS MARKETS AND TRADE PERSPECTIVES. FORESTS AND RAW MATERIAL SUPPLY.

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TRENDS IN BRAZIL ’S PRODUCTION AND INTERNATIONAL TRADE

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  1. TRENDS IN BRAZIL’S PRODUCTION AND INTERNATIONAL TRADE ITTO MARKET DISCUSSION Ivan Tomaselli www.stcp.com.br Libreville - Gabon | November, 2013

  2. CONTENTS • FORESTS AND RAW MATERIAL SUPPLY • INDUSTRIAL DEVELOPMENTS • MARKETS AND TRADE • PERSPECTIVES

  3. FORESTS AND RAW MATERIAL SUPPLY

  4. FORESTS AND RAW MATERIAL SUPPLY • BRAZIL (2012) • - 8 million sq. km • - 60% Forests • 4.5 million sq. km • PLANTATIONS • - 7 million ha • - 1% country area • - 90% pine/eucalyptus

  5. FORESTS AND RAW MATERIAL SUPPLY • BRAZIL (2012) • TROPICAL TIMBER • (Natural Forest) • - 52 million m³/year • PLANTATIONS TIMBER • (pine and eucalyptus) • - 178 million m³/year Source: IBGE 2013, compiled by STCP

  6. FORESTS AND RAW MATERIAL SUPPLY LOG PRODUCTION BRAZIL Source: IBGE 2013, compiled by STCP

  7. INDUSTRIAL DEVELOPMENTS

  8. INDUSTRIAL DEVELOPMENTS • HISTORY OF FOREST SECTOR Colonial Period USA/Finland/Canada Lumber/Plywood/Pulp Lumber/Plywood Pulp/Lumber/Wood Panels

  9. INDUSTRIAL DEVELOPMENTS • CURRENT PRODUCTION (2012) Source: ABIMCI, IBGE, FAO (2013), compiled by STCP

  10. MARKETS AND TRADE

  11. MARKETS AND TRADE Source: ABIMCI, MDIC (2013), compiled by STCP

  12. MARKETS AND TRADE • MARKET TRENDS - Tropical Lumber Exports Volume ↓ x Unit Value ↑ Unit Value(2012)US$ 511/m³ Unit Value(2000)US$ 278/m³ Volume declined 76% in the last 10 years Source: ABIMCI (2013), compiled by STCP

  13. MARKETS AND TRADE • MARKET TRENDS - Tropical Lumber Export Price Prices increased in the last 10 years: - Jatoba 148% - Cambara 70% - AngelimPedra 216% Source: STCP Database.

  14. MARKETS AND TRADE • MARKET TRENDS - Tropical Plywood Export Volume ↓ x Unit Value ↑ Unit Value(2012)US$ 622/m³ Unit Value(2000)US$ 344/m³ Volume declined 93% in the last 10 years Source: ABIMCI (2013), compiled by STCP

  15. MARKETS AND TRADE • DECLINE IN EXPORTS OF TROPICAL TIMBER PRODUCTS IS A GLOBAL TREND - Tropical Lumber Export Volume (2008-2012) Source: ITTO (2012), compiled by STCP

  16. MARKETS AND TRADE • DECLINE IN EXPORTS OF TROPICAL TIMBER PRODUCTS IS A GLOBAL TREND - Tropical Plywood Export Volume (2008-2012) Source: ITTO (2012), compiled by STCP

  17. PERSPECTIVES

  18. PERSPECTIVES • TRADE IS EXPECTED TO CONTINUE TO DECLINE… • The international trade of tropical timber products has been affected by: • Competition with other timber products (plantations); • Development of new competitive products and finishing materials; • Increase in the logistics costs for tropical timber; • Increase in transaction costs (local and international- EU FLEFT, United States’ LaceyAct, Australia’sIllegalLoggingAct, etc); • Market access: barriers and impediments; • Lack of market promotion and product image • Reduction and restrictions on supply; • Lack of investments on technology developments to increase competitiveness.

  19. PERSPECTIVES • TROPICAL PLANTATION TIMBER IS AN ALTERNATIVE… • There are successful tropical plantations that can enhance competitiveness of tropical timber products in the global market • Teak • Acacia • Eucalyptus • African Mahogany • Others • Efforts are needed to maintain competitiveness: • - Increase productivity of plantations and industrial operations • - Develop and improve products performance

  20. PERSPECTIVES • TO ENSURE THAT TROPICAL FORESTS ARE SUSTAINABLY MANAGED AND TROPICAL TIMBER INDUSTRY CONTINUE TO CONTRIBUTE TO IMPROVE THE SOCIAL-ECONOMIC CONDITIONS OF TROPICAL COUNTRIES IS FUNDAMENTAL A GLOBAL COORDINATED EFFORT TO INCREASE THE COMPETITIVENESS OF TROPICAL TIMBER PRODUCTS IN THE MARKET • It is important to consider: • Reduction of transaction costs and market barriers / impediments • Technology developments to improve use of resources and products performance • Market promotion to improve image

  21. PERSPECTIVES • LEARNING FROM OTHERS • - The International Jute Study Group (IJSG) successor to the International Jute Organisation (IJO) www.jute.org Objectives: • Toprovideaneffective framework for internationalcooperation, consultationandpolicydevelopmentamongmemberswithregardtoallrelevantaspectsofthe world ofjuteeconomy; • Topromotetheexpansionofinternational trade in juteandjuteproductsbymaintainingexistingmarketsandbydeveloping new markets, includingtheintroductionofnew juteproductsandthedevelopmentof new end-uses; • Toprovide a forum for theactiveparticipationoftheprivate sector in thedevelopmentofthejute sector; • Toaddresstheissuesofpovertyalleviation, employmentanddevelopmentofhumanresources, particularlywomen, in thejute sector; • Tofacilitatetheimprovementofstructuralconditions in thejute sector throughimprovementofproductivityandquality, andpromotionoftheapplicationof new processes andtechnologies; • Tocreateandincreaseawarenessofthe beneficial effectsofthe use ofjuteas anenvironmentallyfriendly, renewableandbiodegradable natural fibre; • Toimprove marketintelligencewith a viewtoensuringgreatertransparency in theinternationaljutemarket in collaborationwithotherorganizations, includingtheFoodand

  22. PERSPECTIVES • LEARNING FROM OTHERS • - The International Coffee Organization (established in 1963) Private Sector Consultative Board The Private Sector Consultative Board (PSCB) is an ICO body which provides a platform for the representatives of private sector organizations of producing and consuming countries. Established in 1999, it consults with and advises the Council on issues relevant to the coffee sector, either on request or on its own initiative. The PSCB comprises 16 leading industry representativesfrom producing and consuming countries, along with their alternates and advisers.  It generally meets at the time of the International Coffee Council meetings in March and September each year and its Chairperson reports to the Council on the outcome of its meeting.  At the meetings, PSCB representatives review a range of coffee issues including sustainability initiatives, food safety aspects, quality and coffee and health. The PSCB has agreed that its main mission and objective should be to increase the world coffee market in value and volume. One of the constraints for increasing coffee consumption was the misconception that coffee is bad for your health held by part of the population. On the contrary, there is significant scientific information available on various positive health benefits associated with coffee drinking. www.ico.org

  23. PERSPECTIVES • WHY WE ARE WE MOVING TO ANOTHER DIRECTION?

  24. THANK YOU ! Presentation available inwww.stcp.com.br

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