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Vale Florestar S/A
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Forest Plantations – Growth Opportunities in Brazil
Distribution of commercial forests across the world
Fonte: Silviconsult
Land use in Brazil
Fonte: ABRAF
206 million ha
Pasture 18.6%Other 17.1%Native Forest 56.5%Forest Plantations 0.8%Agriculture 7.0%
Source: IBGEOther 25.7%China 31.7%India 10.0%USA 10.0¨%Russia 7.0%Sweden 5.8%Poland 3.3%Sudan 3.3%Brazil 3.2%
Source: Silviconsult
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Brazil currently has 4.26 million hectares of eucalyptus plantations, with annual
growth of 4.6% since 2000
Forest Plantations – Growth Opportunities in Brazil
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Million há
Source: ABRAF, SBS, adapted by Silviconsult
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Eucalyptus timber consumption in Brazil: around 114 million m³/year
Brazilian Forestry Market – Diversified Internal Consumption
Other 2.8%Pulp 32.8%Planks/boards 5.1%Plywood 3.6%Sawed wood 19.7%Charcoal 13.4%Firewood 22.%
Source: Diverse – Adjusted by Silviconsult
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Annual consumption of eucalyptus logs outstrips supply by 2 million m³
Brazilian Forestry Market – Higher Demand Than Supply
Annual deficit
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Million m3
SupplyDemandBalance
Source: Silviconsult
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Productivity – Commercial Advantage in Brazil
Eucalyptus Plantations:
High productivity (Mean Annual Increment > 30/40) and short production cycle (7 years)
MAI (m3/ha/year)
Cycle (years)
BrazilUruguayIndonesiaChilePortugal USACanada
Source: Diverse, adapted by Silviconsult
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Expansion Opportunities at New Frontiers
Area of Forest Plantations2008 (1000 ha)
Total in 2008 = 6.6 million ha
Source: Abraf Annual Report (2009)
87% of planted area
Growth opportunities:
- High productivity
- Large areas of degraded land
- Developing market
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Vale Florestar today
Vale Florestar was created as a Vale project in 2005 and came into operation in 2007
Over the past three years, 24.5 million trees have been planted on 41 leased farms
Area: approximately 70,000 hectares
Vale has invested around R$230 million* in the project – more than one-third of the total
planned amount
Vale Florestar currently employs 1,500 people
(*) As of March 2010
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Partnership for Forest Projects
Vale Florestar S/A
Investment FundR$ 605.04 million
leasing licensing sapling production
planting monitoring sales
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The Future: Vale Florestar S/A
Vale Florestar will operate across a total area of approximately 450,000 ha:
300,000 ha to protect and restore native forest
150,000 ha to develop commercial eucalyptus plantations
The project will require total investment of R$605 million* by 2014, generating 4,000
jobs during peak production
By restoring degraded areas, Vale Florestar S/A will promote carbon capture
The project will have its own tree nursery to grow saplings, with capacity to produce 28
million saplings per year. It will be able to supply saplings to other projects in the region
It will help attract forestry-related industries to the region, instigating a multiplier effect
(*) Adjusted for inflation
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Operational Area
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Area Planted by Vale Florestar
4,1
10,1
5,8
2007 2008 2009
Area planted (1000 hectares)
Breakdown by farm Breakdown by municipality
Total: 20,000 ha
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Planting of native species – Preciosa FarmPlanting of native species – Preciosa Farm
Vale FlorestarRestoration of Natural Habitat
November 2007 March 2010
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BEFORE AFTER
November 2007 March 2010
Surpresa Farm Surpresa Farm
Vale FlorestarProcess of Restoring Degraded Areas
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WatercourseNovember 2007
Surpresa FarmSurpresa Farm
Vale FlorestarProcess of Restoring Degraded Areas
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March 2010
Surpresa FarmSurpresa Farm
Vale FlorestarProcess of Restoring Degraded Areas
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2007 2010
2007 2010
2008
2008
Santa Fé Farm Santa Fé Farm
Vale FlorestarProcess of Restoring Degraded Areas
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Arizona Farm – April 2007Arizona Farm – April 2007
Vale Florestar – Commercial plantations combinedwith preservation of environmental protection areas
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Arizona Farm – March 2010Arizona Farm – March 2010
Vale Florestar – Commercial plantations combinedwith preservation of environmental protection areas
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Vale Florestar S/A aims to reverse this trend...
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Vale Florestar S/A aims to reverse this trend...
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A new reality
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Thank you
Arizona Farm – March 2010Arizona Farm – March 2010
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