Following announcement of US tariffs, Chile will likely be able to balance its trade in forestry products, but changes will take time; Chile's forestry sector is awaiting details, but Arauco, CMPC are beginning to analyze possible effects of US tariffs

April 4, 2025 (CE Noticias Financieras (Latin America)) –

Like many other industries, shipping companies, ports and the forestry sector are calculating how the increase in customs tariffs will affect them. Maritime and port companies believe that the negotiation is only just beginning, but that if the announcements are finalized, international trade and with it sea transport and port activity will suffer. And, while forestry companies such as Arauco and CMPC are awaiting details, they are already beginning to analyze the possible effects.

"The danger is less world trade, affecting maritime transport and port activity."

Daniel Fernandez , president of Camport, made the point that negotiations have just begun.

"That's the kickoff...the game is just beginning." With this soccer metaphor, the president of the board of directors of the Maritime Port Chamber (Camport), Daniel Fernández , graphed the effect that the tariff hike announced Wednesday by President Trump will have on shipping companies and ports, given that, in his opinion, negotiations will now begin and, eventually, retaliations or reprisals from the different countries and trade blocs.

This union groups more than 30 members, including domestic and foreign shipping companies, ship agents, port operators and concessionaires and, therefore, is a key player in international trade, since it mobilizes 95% of the national export and import cargo.

In this sense, Fernández pointed out that, if the tariff increase materializes, "the danger is a lower world trade, thus affecting both maritime transport and port activity", although he reiterated that, for now, we only have a "first picture". For this reason, he said that the final impact of, which must be weighed "product by product" and "market by market", cannot yet be sized.

"The situation is not yet in balance... we do not know the reaction of the other countries and if they are already sitting down to talk," insisted Fernandez. He even revealed that he does not believe that this "will escalate into a trade war", but that the U.S. president "put the tablecloth on the table" to start negotiations under more advantageous conditions for the United States .

In this sense, he expressed that Chile has some advantages, given that it is among the countries with the lowest tariff increase, 10%, with which "even in some products it could increase exports if its competition faces higher tariffs in the US".

For this reason, he pointed out that it is the Government's task to monitor the course of the negotiations and to open new markets to Chilean goods, highlighting what the country is doing with the State visit to India .

Fernández projected that there will be a reorientation of part of the trade flows, but warned that it is still premature to know to which destinations and on what scale. Even so, he sees less trade activity on the US West Coast as feasible.

In any case, uncertainty and the potential impact on international trade are hitting stocks in this sector. Yesterday, Vapores shares fell -1.95% on the Santiago Stock Exchange , while those of SM SAAM declined -0.03%.

International shipping companies also fell. Hapag-Lloyd and the Danish Mærsk even fell more than 9% on fears of lower international trade and, with it, contraction in maritime traffic in the main world routes.

Corma: "Our exporters may see their revenues fall sharply as they adjust their trade portfolios".

Although the guild assures that it is likely that Chile will be able to balance its trade in forestry products, it recognizes that the changes will take time and are not without costs in the short term.

The forestry sector is awaiting details while companies begin internal analyses of the possible implications of the tariffs announced by President Trump . This is despite the fact that timber, like copper, would have been exempted from the tariffs.

Although there were no statements from CMPC and Arauco, the relationship between these companies and the US exists. The former, for example, after more than three decades of commercial presence in that country, in 2023, acquired Powell Valley Millwork, CMPC's first step in its industrial expansion in that nation. In June of that year, the Matte group's paper mill reported annual sales of close to US$ 530 million in the United States . Likewise, for remanufactured products, the North American country was its main market, receiving 90% of production.

Although a few hours after the announcement, the Chilean Timber Corporation (Corma) already acknowledged its concern about the announcements, this Thursday, the union made a deeper analysis. Its president, Rodrigo O'Ryan , stated that "it is likely that Chile , thanks to its trade openness, will be able to balance its trade in forestry products in the medium and long term, by increasing its shipments to member countries of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), such as Australia , Canada , Chile , Japan , Mexico and other Pacific Rim countries), to the European Union or to new trade blocs to which we are applying, such as the RCEP (the union of China , the ASEAN countries, plus Australia , New Zealand , Japan and South Korea ).

However, he warned that "all these changes take time and are not without costs in the short term, where our exporters may see their revenues fall sharply as they adjust their trade portfolios".

In the midst of his reflection, he noted that the U.S. , while it has a very relevant forest industry, has a heavy dependence on imports of forest products from Canada , Mexico , Japan and some southern hemisphere countries.

"This makes it unlikely that local capacity can absorb increased demand, including self-imposed environmental constraints - in the early 1990s - on the harvesting of old growth forests.

Also, products from Chile and other countries are complementary to the value chains of the industries that use them in the U.S. , which provides greater diversity and maintains reasonable costs for end users," said the union leader.