Forest funds estimate investing US$ 2.3 billion in Brazil
Valor Econômico
The Brazilian industry and paper and pulp and sectors that use wood as a raw material see, with optimism, the strengthening of an important ally: investment funds focused on the forest business. In the coming years, the operation of the so-called "timos", Timberland Investment Management Organizations should grow in Brazil, following the increase of the demand for wood and the acknowledged competitiveness of the country in the forestry area. According to a projection of this industry, which still takes its first steps in the country, at least R$ 4 billion (US$ 2.3 billion) in investments should come from institutional investors within the next five years. Recently, the Suzano, Klabin and Irani groups have entered into operations with funds of this kind.
In Brazil, it is estimated that lands under negotiating amount to nearly 200 thousand hectares of planted area, distributed throughout eight States, and there are projects underway for new areas of cultivation, in partnership with industries both related and non-related to the forestry sector. Nederson de Almeida, partner of Consufor, asserts the timber sector is going through a unique moment, after facing difficulties in recent years because of the foreign exchange rate and the falls in exports.
According to him, the pension funds see the forests as attractive low-risk safe long-term return investment. "2010 should be a heated year", he foresees. This semester, Funcef and Petros invested R$ 550 million (US$ 319.8 million) in the Forestry Private Equity investment Fund (FIP) that belongs to Florestal Investimentos Florestais. The goal of Florestal, according to Lopes, is to have 215 thousand hectares of eucalyptus forests in Mato Grosso and Mato Grosso do Sul.
According to the Chief Executive Officer and one of the founders of Brazil Timber, José Leal, besides the pension funds, other foundations and insurance companies are also traditional investors in this market abroad. "There is a growing interest of the individual investor with great assets" he adds. According to Leal, Brazil Timber was the first company of national capital in the sector and it currently manages US$ 230 million in forestry assets, a value that should double in 2010 and double again in 2011. "Brazil is in and the forests are also in. A forest is currently the dream of consumption of the long-term investor", he guarantees.