The paper and pulp market is one of the few that has survived the crisis that has taken over the industry in the country. In 2015, the sector saw the greatest growth in market value on the stock exchange, with an expansion of 59,6% or R$26,6 billion, according to Economática. Klabin, the leader in the paper segment in Brazil, saw the greatest increase: 66,4%, worth R$23,1 billion on December 18. Behind it came Suzano Papel e Celulose (+61,2%) and Fibria (55,1%), according to the Brazilian Tree Industry (Ibá).
The world's largest producer of eucalyptus pulp, Fibria's shares recorded the best performance among the most liquid on the Bovespa, with an appreciation of 71,44% last year. The paper and pulp industry has three of the four shares that showed the highest appreciation on the Stock Exchange.
The explanation for this performance is closely related to the behavior of the exchange rate in Brazil. Producers went against the grain of the Brazilian economy, which has been in crisis for at least five years. Since 2011, the recession and political instability have caused the real to lose 60% of its value, which, especially for pulp manufacturers, was cause for celebration.
According to the Standard & Poor's rating agency, in 2015, the devaluation of the real caused a US$50 per ton drop in pulp and paper production costs. In addition, another US$40 per ton was saved on maintenance of the facilities.
Estimates from UBS Bank indicate that for every 10 cents that the real loses against the dollar, Brazilian manufacturers pocket profits of US$15 per ton sold. At the same time, while the prices of other commodities produced in Brazil have fallen sharply in recent years, pulp prices have remained stable. In China, toilet paper consumption is on the rise and more than 40% of Brazilian pulp is transformed into toilet paper destined for the Chinese.
According to Ibá's calculations, in the first two months of 2016, Brazil produced 1,7 million tons of paper, 1,4% more than in the same period of the previous year, and 3 million tons of cellulose (growth of 9,4% compared to the first two months of 2015).
