Paraguay Seeks Billions from Fast-Growing Forestry Sector

Paraguay’s forestry industry is still small, but its leaders believe it could become one of the country’s main economic engines within the next decade.

According to the Paraguayan Federation of Wood Industries (FEPAMA), the sector today exports about 100 million dollars a year. Yet the country has the land, climate, and growth rates to push revenues up to three to five billion dollars annually if investment arrives.

The foundation is in place. Paraguay currently has about 300,000 hectares of planted forests, mainly eucalyptus. Sector studies show that the country could expand this area to three million hectares without displacing cattle or soy.

Eucalyptus grows to industrial size in just 7 to 12 years in Paraguay, giving the country an advantage over temperate nations like Finland, where rotations often take several decades.

Finland, with three-quarters of its land under forest cover, exports about twelve billion euros of forest products annually. Neighboring Uruguay shows what scale can deliver.

It has developed more than 1.1 million hectares of plantations and three major pulp mills. Its forestry exports exceeded three billion dollars in 2024 and 2025, more than cattle and soy combined.

Paraguay Eyes Major Boost in Forestry Industry

Paraguayan leaders argue that their country has the same potential, but only if it invests in industrial capacity and infrastructure. The centerpiece of this effort is the Paracel pulp mill in Concepción, valued at four billion dollars.

When completed, it will be Paraguay’s largest private investment and the country’s first large-scale pulp producer. This project could anchor a domestic market for timber.

It may also help Paraguay move away from its dependence on charcoal, which still accounts for 75 to 80 percent of forestry exports. The United States is the top buyer of Paraguayan charcoal, followed by Uruguay, Chile, Brazil, and Costa Rica.

Almost all of Paraguay’s current forestry supply—about 98 percent—comes from planted trees. Industry leaders stress that this ensures sustainability and makes full use of every tree, including residues for boards and energy.

The fact that Paraguay’s electricity grid runs almost entirely on hydropower adds another advantage, as mills can operate with a low carbon footprint.

To prepare for this transition, Paraguay has launched training programs with Finland and Uruguay so local operators can manage advanced machinery. Industry leaders insist that Paraguayans must run the technology to keep jobs inside the country.

The upcoming Expo Madera 2025 in Asunción will showcase this ambition. Scheduled for September 12–14, it will bring together companies, investors, and institutions to discuss forest management, certifications, carbon markets, and investment opportunities.

The message from the sector is clear: Paraguay has the land, growth cycles, and energy to build a major forestry industry, but it needs capital and commitment to turn that potential into reality.

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