CMPC threatens to shift Brazil pulp mill to Paraguay over licence delay

CMPC has warned it may move its planned USD 5.26bn (BRL 27bn) Nature Project pulp mill from Barra do Ribeiro in Rio Grande do Sul to Paraguay unless it obtains an environmental licence by the end of 2026. The 2.5 million tonne-a-year eucalyptus pulp plant is stalled after Brazilian federal prosecutors challenged the licensing process over consultation with indigenous and traditional communities. CMPC has spent USD 400m on development and studies without starting construction.

Why this mattersA relocation would hand Paraguay a major eucalyptus pulp project and signal that Brazilian licensing delays now weigh as heavily as cost or wood supply in forestry investment decisions.

• CMPC's Brazil general director Antonio Lacerda said an environmental licence is needed by December 2026, or the project slips two to three years and could move to Paraguay.
• The plant would produce 2.5 million tonnes of eucalyptus pulp a year at Barra do Ribeiro, Rio Grande do Sul.
• Project value is put at USD 5.26bn (BRL 27bn), described as the largest private investment in the state's history, with 12,000 jobs.
• CMPC has committed USD 400m to development and studies without building any of the plant.
• Federal prosecutors filed a public civil action on 13 May 2026, arguing the Fepam licensing lacked free, prior and informed consultation with artisanal fishing, Guarani Mbya and quilombola communities under ILO Convention 169.
• The original schedule foresaw construction starting in 2026 and commercial operation in August 2029, with a dedicated terminal at the Port of Rio Grande valued at about USD 584m (BRL 3bn).

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