Look north from atop the 120-metre (390-foot) bleaching tower at the Horizonte 1 pulp mill, and all you see is plantations of tall, slender eucalyptus trees. They stretch from the factory gate, across the gentle undulations of Mato Grosso do Sul, a state in Brazil’s centre-west, all the way to the horizon. “That’s our competitive advantage,” explains Alexandre Figueiredo, who is in charge of production at the plant. Its owner, Fibria, is the world’s biggest producer of “short-fibre” cellulose pulp, which is used to make such things as newsprint, nappies and banknotes. (“Long-fibre” is used for high-grade paper and packaging.)
As its name suggests, Mato Grosso do Sul (roughly, “southern thick bush” in Portuguese) has vast expanses of cerrado, or tropical savannah, a chunk of which was long ago turned into farmland, some of which has more recently been planted with eucalyptus. Most of Fibria’s 568,000 hectares of plantations lie within 200km of its mills. Eldorado, a rival with a mill on the other side of Três Lagoas (a city of 115,000 that is fast becoming Brazil’s cellulose cluster), needs its lorries to drive only a bit farther. No other firm in the world has such ready access to its raw material. Add the balmy climate and rich soils of Brazil’s south and centre-west—where, as Joe Bormann of Fitch, a credit-rating agency, puts it, eucalyptus “grows like a weed”—and it is easy to see how Brazil has conquered 40% of the global short-fibre market.