Argentina

Argentina

The different sectors of the economy in Argentina' have gone through major changes. This includes technological development of the agricultural sector, the specialization of agriculturally-based industries, the modernization of the services and commercial sectors and the dominating presence of large national and international business firms. Currently the forest industry participates with almost US$750 million in annual exports (woods, pulp, paper and cardboard, and furniture), and $750 million in imports, so there was a commercial balance in 2003 and 2004. These, although growing constantly, represent only 2.7% of the country's total exports.

Argentina has about 1.2 million ha of forest plantations as of 2007. The rate at which plantation forests have been established increased from 15,000 ha to 50,000 ha a year between 1990 and 2004, with peaks of more than 100,000 ha. While in the 1980s and 1990s the planting effort was driven by the demand of the pulp and paper industries, the new stands are more diversified and subjected to more precise requirements regarding quality and wood specifications. This kind of demand requires the use of genetic material of a better quality and specific origin, lower plantation densities and, specially, changes in forest management through thinning and pruning practices. Quality site studies, genetic improvement and adjusted management practices contribute to optimizing the productivity and industrial suitability of the forest products, and are reflected in higher annual growth rates, and improved wood quality.

The Forestry Sector Today

International companies gain access to the Argentine forest industry sector by buying companies, as partners of national companies, or installing their own business and investing directly. This provides the forest industry sector new technology and business organization, as well as the opening of new businesses in international markets.

Argentina Law 25,080 on investments in plantation forests gives legal authority to the existing benefits linked to the incentives for the establishment of new forest. It guaranteed that ventures developed within the law will not have any kind of tax increases at national, provincial or municipal level within the next fifty years. It also allows reimbursement of the added value tax, within a year of forest investment, grants exemption to a number of taxes (to actives, property, stamps, gross income, etc.), and permits the early amortization of capital goods.

Productive Forest Profile

The comparatively high rate of annual growth for the conifer and broadleaf planted forest in Argentina allows short rotations. Although rotations are variable according to genus and species, site and objective of the plantations, they are between 10-12 years for poplars, 8-10 years for willows, 10-12 years for eucalypts, and 20-35 years for pines.

The planted productivity of forests is high, and equals or surpasses that of many traditionally forest countries. There is experimental evidence, verified in plantations at a commercial scale, which indicate that productivity can be substantially increased through genetic improvement and proper management of the plantations. This will allow the reduction of the rotation ages while at the same time attaining wood of a better quality or more suitable for industrial use.

Common growth rate are 30-35 m3/year for Pinus taeda in Misiones; 35-40 m3/year for Ecucaliptus grandis in Corrientes and Entre Ríos, and up to 20 m3/year for Poplar in the Delta region. The establishment cost for pine plantations in Misiones and Corrientes varying from 700 to 1000 U$S/ha, 800 U$S/ha for Eucaliptus in Corrientes, and prices that range from to 2 U$S/m3 for pulp up to 60 U$S/m3 for veneer. The IRR, are around 12 % for Pinus and 14% for Eucaliptus. One of the reasons for this results, is the relatively low prices of the land, oscillating between US$ 500 and US$ 1500 the ha.

The native forest covers around 33.2 million ha, with an important issue of increasing deforestation. The main regions are the tropical forest such as “Selva Misionera” (1.5 M ha), “Selva Yungas” (3.7 M ha), temperate dry forest (Espinal, 2.6 M ha; Parque Chaqueño, 23 M ha), and the Patagonias Forest (2 M ha). Selective logging without planning is the most common use of this forest. The commercial activities are concentrated in Misiones (650,000 m3 of harvests per year) and in the Yungas (150, 000 m3 per year). The forests in the Patagonias focus more on tourism through the National Parks, with a very little timber harvesting.

Forest Industry

Forest industry manufacturing in Argentina consists of 2,300 companies, which provide 23,000 direct permanent jobs. Sawmills predominate the industry structure, with some 2,200 units. The balance of the firms consist of mills producing particle and fiber boards, sliced veneer, plywood and veneer for other uses. Of those sawmills companies, 700 are located in Misiones, and 300 in Corrientes. The pulp, paper, and paperboard industry is responsible for half of the jobs generated by the forest industry. There are 66 registered pulp and paper companies, with an installed capacity of more than 3 million tons year.

The pulp and paper industry consumes 46% of the planted forest's current harvest, and pine prevails as raw material. Sawmills consume 41% of the planted forest harvest, also using wood from the native forest. The paperboard industry is the third largest consumer of raw material from planted forest, totaling 12% of the harvested wood, of which eucalypts and salicales prevail. The laminated veneer industry consumes 1 % of the resource.

Regarding the installed industrial capacity, there has been a remarkable growth of investments in the last ten years. Between 1997 and 2000, there was an important volume of new investment at a rate of more than 500 millions U$S by year. After the 2001 financial crisis and default, there is again a increasing trend, reaching more than 100 millions in 2004.

The estimates of round wood production vary from 6.6 millions to 8 million m3, with the main destination (98%) for industrial uses. Of this round wood production 4 millions are produced in Misiones, and about 1.5 in Corrientes.

Conclusion