IRC Americas Program Special Report Cellulose and Forestation Two Sides of a Predatory Model By Raúl Zibechi | October 24, 2005 Translated from: Celulosa
Americas Program, International Relations Center (IRC) americas.irc-online.org
The construction of two huge cellulose factories on the Uruguay River that threaten to pollute the binational stream illustrates how a model of forestry imposed by neoliberalism in the 1990s is gaining ground in the Southern Cone.

Ten percent of Uruguay's farm land is planted with trees for the production of cellulose. Eucalyptus monoculture displaced the important cereal production (wheat, barley, linen, and sunflower) that had become one of the country's main export sectors.

The forestry fever started 16 years ago, pushed by the neoliberal model and pushed by policies of the World Bank and the Interamerican Development Bank (IADB). At that time, a ton of pulpable lumber was worth $60 on the international market and demand was high. In the view of financial institutions, the indiscriminate felling of pulpable lumber, at a worldwide rate of 15 million annual hectares, required replacing tropical forests as the main source for paper and cardboard production.

Uruguay, among other third world countries, seemed like a good candidate for the production of pulpable wood, and, starting in 1998, national governments followed the recommendations of international institutions to the letter. One was to offer massive state subsidies to the growing sector: 50% of the cost of planting, very low-interest credits with a grace period of up to ten years, exoneration from national and municipal taxes, and the construction of infrastructure (bridges, ports, roads, and railways) to facilitate the transport and export of wood. In barely 12 years the Uruguayan state invested over $500 million (between direct disbursements and uncollected taxes) in support of monoculture planting, almost 4% of the country's annual internal gross product.3

The results of the investment, which was made at the cost of reducing Uruguay's education and health expenditures, have been clearly negative. Since many countries followed the recommendations of the IADB and the World Bank, the world supply of pulpable wood grew and prices dropped to less than half of what they were when massive forestation was promoted as a “safe, profitable and reliable” business. Now, with the price oscillating between $23 and $28 per ton, many small private investors have not been able to recoup their investment.

Meanwhile the large corporations apply a double pressure: to make the government build large infrastructure works (one 45-ton truck carrying wood arrives in the port of Montevideo every five minutes) and to build cellulose factories to compensate for the fall in the price of raw wood. The biggest foresters are the ones planning to install the large factories: the U.S.-based Weyerhaeuser owns 130,000 hectares of forest monoculture, the Finland-based Botnia has 57,000, and Spain's Ence has another 50,000 in the country.

Studies reveal that tree monocultures generate serious problems for the country. Tree plantations expel the rural population, since they occupy last place in job creation per hectare, employing just four workers for every one thousand hectares , compared to six in the case of intensive cattle grazing, eight for rice, and at the opposite extreme, 133 workers for every 1,000 acres in horticulture, 165 in viticulture, and 211 for poultry. Besides, the growth of tree plantations keeps farmers from farming their lands because these species of trees dry up surrounding soils that end up unusable for agriculture as sources of water disappear.

For the few who do find employment, Uruguay's Association of Labor Inspectors (AITU) carried out an investigation that shows that some 6,000 forestry workers live in semi-slavery conditions on tree plantations. A specialized chainsaw worker—who has to pay for the saw out of his own pocket—earns barely five dollars a day and is the highest paid of forestry workers. The inspectors conclude: “It is practically a slavery system. Months and months pass without receiving hardly anything, in a cycle in which they cut and sleep, send food to their families and don't see one peso. They sleep in infrahuman conditions, under tents almost always made from simple pieces of cardboard and on a floor of dirt.”4

As for the impact of the plantations on soils, a study done by a team of researchers from the Sciences faculty of the University of the Republic holds that after 25 years of forestation with eucalyptus the results are grave.5 The soils become highly acidic: while Uruguayan prairies have a Ph of 6.5 to 6.8, the parcels that have tree plantations showed levels of 3.8 to 4.0. Eucalyptus extracts great quantities of calcium from the soil, lowering the Ph level, causing the soil to be less permeable because of the proliferation of fungus and mycelia, which in turn keeps water from penetrating the land and increases erosion. Other results, according to the study, are reduction in fertility, of organic matter content, and irreversible changes in soil texture and structure.

A study carried out in Chile shows that forestry regions are the most impoverished in the country. Between 1994 and 1998 some zones with high forestation impact have registered a growth in poverty and homelessness of up to 29%.6 Chile, with over two million forested hectares, has been defined as the “forestry model” to follow. However, the study reveals that municipalities where the increase in poverty has been highest are those in which besides tree plantations there are also cellulose and paper factories, like the Comuna de Constitución and the Comuna de Nacimiento, in southern Chile.

Both the Uruguayan Ministry of Livestock, José Mojica, and of Labor, Eduardo Bonomi have declared the need to limit forestation. Mujica pointed out that forestation degrades soils and declared himself opposed to continuing to provide facilities to forestry multinationals through generous subsidies. Bonomi denounced the irregular work conditions, the “irresponsible outsourcing and subcontracting” observed in the sector, and assured that the state will start to control the work in that sector.7