May 15, 2025 (Industry Intelligence Inc.) –
Chilean conglomerate Empresas Copec, through its forestry arm Arauco, warned that uncertainty over U.S. tariff policies and a trade war are making the Chinese market for its forestry products more challenging, Reuters reported. Pulp prices have fallen, leading to a 22% dip in core earnings in early 2025, and customers are minimizing purchases due to unpredictable pricing. Similar market pressures are seen in Europe and the U.S., even as Arauco starts construction of a $4.6 billion pulp mill in Brazil expected to produce 3.5 million tons per year by the end of 2027.
- U.S. tariff uncertainties and trade war pressures are affecting pricing.
- Core earnings fell over 22% in Q1 2025 amid declining pulp prices and volumes.
- Chinese paper makers are shifting to local sourcing to avoid long-term price agreements.
- Similar concerns are emerging in Europe and the U.S. with cost increases noted.
- Arauco is investing in a new pulp mill project in Brazil scheduled to launch by the end of 2027.
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