Brazil's Eucalyptus Industry Faces Uncertainty Over Delayed Curbs on Native Wood Fuel Use

An agreement aimed at phasing out native forest wood for energy generation in Brazil's corn ethanol plants has been put on hold, creating uncertainty for investments in eucalyptus plantations.

The agreement was signed in June between the state government of Mato Grosso and the local prosecutor's office, but Governor Otaviano Pivetta postponed issuing a decree meant to establish the rules for the phase-out.

Eucalyptus offers a more renewable alternative of biomass for corn ethanol plants, according to industry advocates, but it requires long-term investment and regulatory certainty.

Arefloresta president Fausto Takizawa stated that 'investment is indeed affected. For anyone considering investing in forests, this raises a yellow flag.'