Paraguay has more than 5.8 million hectares with very high potential for investments in forestry sector; government's 'Paraguay Forestry for the World' plan seeks to position industry, forestry products abroad, meeting traceability requirements for export

Sample article from our Forestry & Timberland

December 11, 2023 (press release) –

Photo credits: National Forestry Institute (Infona).

Asunción, Agencia IP.- The Forest Investment Viewer, recently presented by the National Forestry Institute (Infona), showed that the country has more than 5,800,000 hectares with very high potential for investments in the forestry sector.

Based on this potential, the Government promotes the «Paraguay Forestry for the World» plan that seeks to position the industry and forestry products abroad, meeting the traceability requirements that will allow increasing exports not only of wood products but of the primary commodities such as soybeans and meat.

This was stated by the President of Infona, Cristina Goralewski, during the Plaza Pública DENDE program, where the topic was «The new star of the Paraguayan economy.» The forestry sector: analysis and reflections on its great potential» was addressed. The program counted with the participation of Ricardo Kiriluk, Director of «Desarrollos Madereros,» moderated by Yan Speranza.

Goralewski explained that the forest traceability component is focused on compliance with the regulations and agreements between the European Union and Mercosur and will allow a demonstration of the development process that Paraguay is carrying out. She stated, «Today, the markets that pay more for our products are becoming more demanding regarding sustainability, regardless of the country’s regulations.»

Currently, the country has 205,000 hectares of forest plantations, mainly in the Eastern Region. The manufacturing sector comprises more than 400 industries, of which more than 80% are sawmills, with Caaguazú being the area with the largest forestry industries.

Goralewski stated that the Forest Investment Viewer is dynamic and will be updated as new industries are installed in our country, not only forestry but also those that consume biomass.

Among them, she cited Paracel, in Concepción, which will invest USD 4,000 million and have a weight of 4% in the GDP, and Investancia, in Carmelo Peralta. While Paracel will base its production on eucalyptus, Investancia invests in Pongamia, a forest species whose fruit produces biodiesel and has a high nutritional component for livestock feed production.

Guarantees to finance the forestry sector

At another time, the Minister of Infona pointed out the importance of having credits destined 100% to forestry production. She said that the presence of the financial system is still «shy» to accompany the sector’s growth, which demands at least seven years for cellulose and biomass and ten years for solid wood. However, she announced that they are working with the Development Finance Agencies (DFAs) on a Forest Guarantee Subfund to leverage credits for the sector.

Goralewski expressed that her challenge as head of the institution in this period is the development of the National Forest Policy, based on an existing document, which must be updated and socialized, not only with the forestry sector but also with the financial and industrial sector, among others.

Genetic improvement

Ricardo Kiriluk pointed out that Paraguayan forestry production’s genetics are outstanding and only available in some places worldwide, so they should be taken advantage of. He added that just as our country exports soybeans, corn, different types of oil, and meat in large volumes, the forestry sector has to take that path and export boards, furniture, pulp, and new products that will probably come from the pulp industrial companies.

He welcomed that DFAs and private banks are developing financing systems for the forestry sector. However, he said that work must continue on the interest rate so that it is low and that there must also be an agile system to grant financing. He added the guarantees when the bank lends, for which they can work with insurers.

Also, he said that worldwide, the export business of multilaminate boards is approximately 25 million cubic meters per year, for which an offer in quality and quantity is required. In this regard, he indicated that Paraguay could take advantage of the restrictions on the production of native wood in some producing and consuming countries and start producing more from boards of different types, which are inputs for furniture production.

He stated that some local industrialists are exporting furniture kits to different parts of the world. «It would be a great challenge and something exciting. Let’s start producing wood and industrialized products locally to start building houses,» he indicated.

Meanwhile, Alberto Acosta Garbarino, Head of DENDE, said that the forestry sector started very slowly, with a lot of effort, and that it will increase much more with the appearance of paper mills. He added that the financial sector understands how this business works, with the presence of the DFAs, and is beginning to finance it long-term, with guarantees that allow this financing and suitable insurance policies that can cover the risks involved in this crop.

Finally, Yan Speranza indicated the need to join forces for the forestry sector to develop and strengthen financing with knowledge and specialists who understand its dynamics and provide them with different characteristics than other business models usually have but which are profitable.

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Dan Rivard
Dan Rivard
- VP Market Development -

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