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Três Lagoas will host the two largest pulp mills in the world

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Issue date: 
November 30, 2010
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Plantation Management


Brazilian Valonline reports today that Marcelo Castelli, director at Fibria Cellulose SA with eucalyptus plantings in the city Três Lagoas (In the state Mato Groso de Sul) will maintain the schedule for opening of the second line of factory in 2014. With investments of 5.8 billion real (BRL), the forests must be planted before the end of 2011.

1 BRL = 0.583771 USD
1 BRL = 0.447944 EUR
1 BRL = 4.09412 SEK

Article about Três Lagoas  from 2010-05-16
The BRIC country Brazil is becoming the forest industry's equivalent of China. The municipal Três Lagoas (Three Ponds) will host the two largest pulp mills in the world and become the capital of pulp in Brazil within approximately three years. Construction of Pulp Eldorado will start in 2010. The project is estimated to cost US$1.7 billion and will be located in the state Mato Grosso do Sul - situated at a junction of roads, river and rail in the midwest region of Brazil. The main markets are China - the largest consumer of pulp in the world at the moment - Europe and the United States.  
In addition to the volume production of fiber - the world's largest, with production of Real 1.2 million / tonnes per year - will be more than two million tonnes of raw material departing from Três Lagoas annually for export. This mill will be designed to 4380 tons/day.  This will put this mill in a league of its own since the largest market pulp mill now in operation (operated by APP on Hainan Island, China) is producing only 3800 mt/day. 

Hard competition for the northern hemispere
The competition for the forest industry for the traditional powers in the northern hemisphere will be hard. Factors such as access to cheap land and labour and fast-growing eucalyptus trees, thanks to a perfect climate and good soil will pose tough competition for pulp producers in Europe and North America. 
Given these conditions it is not surprising that the world's most profitable forest companies are located in Brazil. In Brazil Três Lagoas was competing with three other cities and two states for investment - the names were not disclosed - since the announcement could hamper the process.
Large budget for construction
According to Mayor Simone Tebet (PMDB), the construction of Eldorado Pulp and Paper is budgeted at about Real 2.9 billion - is expected to consolidate the town as a major pole of cellulose in the world. "With the advent of IP [International Paper] and Fibria, Três Lagoas will became known in Brazil. The El Dorado project is part of company Eldorado Pulp and Paper, founded by two founding partners of Forest Brazil, MCL and Business Ventures Ltd. and J & F Participacoes S / A.

According to the CEO of Eldorado Pulp and Paper, Mario Celso Lopes, building the plant in Três Lagoas (MS) must begin within six months after completing the licensing process. "Within eight to ten months at most, we can take the kick-start the work.
In the construction phase around seven thousand direct jobs, reaching 13,000 workers at peak construction will be generated  The plant will be located on the farm Santa Vera, 231 km from BR-158 (between Three Lakes and Selvíria) and have a total of 300 acres of constructed area. 

By design, the Eldorado Pulp and Paper should be responsible for production and export of one million tons of bleached pulp per year."Five years ago we had been studying the thread. Today, gill cellulose is highly demanded and Brazil is one of the few countries capable of producing the raw material [eucalyptus] in such a short time. The Forest Brazil is another company of eucalyptus with about 215 000 hectares only in the Midwest and may commission reports from factories, but this project is not related to this project.

Forestry in Brazil has often been criticized. 

The large-scale forestry and agriculture, in the states as Bahia and Mato Grosso have previously faced opposition from Indians and millions of landless Brazilians. The soil is often nutrient-poor and require massive fertilization. Brazil has despite past indifference to the Kyoto agreement, very ambitious environmental goals: reducing carbon dioxide emissions by up to 40 percent by 2020. It is possible because the country lies in fourth place in the world among the largest emitter. A significant part of the high emissions in Brazil is explained by the deforestation of the forest. The government of Brazil has completely changed the forest policies of the last decades of the past have encouraged settlers to cultivate the interior to stop deforestation now.During 2008-09 was also the lowest deforestation in a few decades, approximately 7000 square kilometers annually to almost 20 000 annually during the decade up to 2005.

But also domestic demand for pulp and paper will increase. Brazil economy ranks highest among all the South American countries and recent frontpage in the authorative magazine Economist was titled with the heading "Brazil takes off". Latin American economies as a whole are recovering nicely from the global economic downturn according to IMF. Gross Domestic Product (GDP) in Brazil expanded at an annual rate of 2.00 percent in the last quarter 2010. OECD predicts even higher expantion of GDP (view image).


Extpub | by Dr. Radut