Planted forests in Brazil provide a number of products other than wood raw materials. Consider the Eucalyptus tree, for instance: from its leaves, it is possible to obtain essential oils and natural dyes; from its flower, Eucalyptus honey; and its branches and bark provide biomass for power generation. Pine forests, particularly the Elliotti and tropical species, produce a valuable resin that is used by the chemical and food industries in the manufacture of disinfectants, detergents, paints, adhesives, aromatics and flavorings.
According to data from the Association of Brazilian Resiners (ARESB), Brazilian resin production in 2017/2018 was 185,700 tons. The state of São Paulo ranks first in the main resin producing states, with 110,000 tons, followed by Rio Grande do Sul and Paraná (Figure 1).
Figure 1. Major Brazilian States Producing Resin (Harvest 2017/2018)
Evolution of Resin Production
Like many other segments of the economy, resin production in Brazil was negatively impacted by the Great Recession of 2008 and the international financial crisis that followed (Figure 2). Since then, however, the segment has been steadily growing—especially over the last two harvest seasons. Since 2011, resin production has increased 103 percent (12.6 percent per year).
Figure 2. Growth of Resin Production in Brazil
Prices also accompany this growing pace of production. In December 2018, the average price per ton was R$3,425.00 (Figure 3).
Figure 3. Brazilian Resin Price Trend
Elliotti pine trees can produce resin for up to 15 years, and each tree produces roughly 6.6 lbs. of resin per year depending on seedling quality, age, method of resin extraction and forest management protocols. If a landowner uses a planting method with a spacing of 3 x 3 meters (1,111 trees per hectare), for example, the forest can yield 6,124 lbs. of resin per hectare per year with an annual gross revenue of over R$10,000 per hectare.
Impacts of Resin Production on Tree Growth
There has been a great deal of discussion regarding the impact that resin production has on tree growth. Some experts point out that resin can affect the diametric development of trees, but tree height is not significantly affected. Wood quality generally does not suffer due to the production of resin either, and new harvesting technologies have been adopted to guarantee a higher quality resin with a lower impact to the forest.
Brazilian Resin Exports and Market Outlook
China is the leading resin producer in the world, followed by Brazil and Indonesia. Together, these countries account for more than 90% of the world's resin production. Brazilian resin exports have increased significantly since 2013 (Figure 4) and this trend is expected to continue in the near term.
Figure 4. Growth in Brazilian Resin Exports
Of the total volume exported in 2018 (approximately 27,000 tons), more than half was exported to Portugal, followed by Vietnam, China and Spain (Figure 5). Over the next several years, China will likely increase its share of Brazilian resin imports due to a decrease in its domestic production.
Figure 5. Export Destinations for Brazilian Resin in 2018
Based on the recent (and projected) growth of the resin market, pine resin production market may be a lucrative alternative for landowners to generate extra income in the medium term until their forestlands are matured and ready to be cut.
Forest2Market do Brasil helps customers to identify suitable pine plantations in Brazil by using its new planted forest detection tool, Timber Supply Analysis 360 (TSA360). This tool allows customers to identify planted forest area by age class in a specific region, which enables them to target those plots that may be used for resin production.