Spain's Pulp Mills Turn to Domestic Eucalyptus Chips, Imports Cut Dramatically
European pulpmills imported much less Eucalyptus chips from Latin America during
2012, mainly because Spanish pulp mills reduced their reliance on relatively costly wood
fiber from Uruguay dramatically. Pulp mills in
Spain have also paid less for domestic pulplogs the past year, resulting in substantially
lower wood fiber costs in 2012 than the previous year.
In the first ten months of 2012, Spain decreased imports of wood chips by as much as 58%.
Jan. 22, 2013 (Press Release) - The pulp industry in Spain has turned its focus to increasingly rely on
domestic wood fiber sources rather than imported wood fiber the past year. Importation
of wood chips importation was down as much as 58 percent the first ten months of 2012
as compared to the same period in 2011, and there has not been a single chip vessel that
has entered a Spanish port since May of 2012, as reported in the Wood Resource
Quarterly (www.woodprices.com). This is a remarkable turn-around in wood fiber
sourcing. As late as 2011, Spain imported 675,000 tons of Eucalyptus chips, 87 percent
from Uruguay and the rest from Congo and Chile.
Over the past eight years, Uruguay has exported between 300,000 oven-dry metric tons
(odmt) and 600,000 odmt annually to Spain, so losing all that volume is a major setback
for landowners and chip exporters in the country. Total chips exports to Spain for 2012
will be an estimated 200,000 odmt, which represents less than half of the shipments in
2011, and is the lowest levels seen since 2004. Even the other two major buyers of
Eucalyptus chips, Portugal and Norway, have cut back purchases substantially the past 12
months with the result that total volumes of chips exported from Uruguay in 2012 may
reach a total of only 700,000 odmt, down from almost 1.6 million odmt in 2011.
Eucalyptus log prices in Spain have been declining steadily for more than a year, and the
major fiber consumers have lowered the price they pay to land owners practically every
quarter since early 2011. The average Eucalyptus log price in the 3Q/12 was 11 percent
below the price in 3Q/11, according to the WRQ. In US dollar terms, the average cost for
Eucalyptus has declined by 26 percent since its all-time-high in the 2Q/11. Spanish pulp
mills currently have some of the lowest hardwood fiber costs in Europe, but are still
paying more for hardwood fiber than competitors in Latin America and North America.
SOURCE: Wood Resources International LLC