Brazil's tree farms thrive as Amazon deforestation recedes

With Brazil remaining under international pressure to preserve the Amazon rainforest, Latin America's largest economy is making progress developing a forestry industry that does not rely on cutting down old-growth trees.

The latest forestry survey data available on CEIC's platform shows that Brazil set another record high last year in the production of wood logs from planted trees. At the same time, the annual deforestation rate receded.

The silviculture industry harvested 173 million cubic meters of logs from tree plantations in 2023, a fourth consecutive year of growth. This was primarily driven by productivity gains, as the total area dedicated to tree farms had remained relatively unchanged since 2019.

Despite the uptick in supply, 2023 was characterized by subdued demand for wood logs. The pulp and paper sector—which accounts for 65% of national wood log production—experienced a 2.5% decline in its Index of Industrial Production (IPI). In 2024, however, demand rebounded. From January to July, output from the pulp and paper sector rose by 4.65% year-over-year. (Brazil is the world's leading exporter of pulp, with its exports doubling over the past decade.)

Our map shows how the expansion of tree plantations is likely a relatively small threat to the Amazon's native ecosystems. Production is primarily concentrated in the south, far from the Amazonian states in the northwest.

This year's uptick could mean that producers further increase supply from that southern belt. In August, the IBA association of forestry companies announced that USD 19 billion of investments would expand pulp and paper production capacity by 2028. Most of these projects will be concentrated in the state of Mato Grosso do Sul, which saw its wood log production for pulp and paper rise by 132% year-over-year in 2023. This state (west of Sao Paulo state on our map) is now the largest pulp exporter in Brazil.

Meanwhile, greater oversight by the federal government has helped reduce deforestation. President Lula's government has targeted illegal wood extraction, mining, agriculture and livestock farming in protected areas. It's notable that deforestation rates tumbled under Lula's first term, from 2003 to 2011, before creeping higher under his successors.

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