It is a continent of change, of development, of expansion – one that is hardly in the doldrums. Two major pieces of news give us articles for this focus on Latin America: first comes the sale by the giant Masisa of its board-making facilities in Argentina, Brazil and Mexico. The plant in Argentina has found a buyer in the form of Egger, a newcomer to the continent – and indeed a newcomer to production anywhere outside Europe – but a newcomer that has global ambitions. On page 29 we examine the reasons for the sale, and for the purchase, and carry an interview with Ulrich Bühle of Egger who explains more.

As we go to press, news emerges of Masisa’s other assets. Those, too, have found a purchaser. It is the Chilean wood panel group Arauco, through its Brazilian subsidiary Arauco Brazil. The assets consist of two industrial facilities, one in Ponta Grossa, Paraná state and the other one in Montenegro, Rio Grande do Sul state. The purchase price is US$102.8m, but Arauco will be taking on a Masisa Brazil debt of US$44.7m, making the final amount due to Masisa about US$58m.

The complete transaction will be finalised during the first quarter of 2018 because the deal has to be approved by the Administrative Council of Economic Defense (CADE ), a body of the Brazilian government equivalent to the SEC in the US.

According to Masisa, the MDF plant in Ponta Grossa produces 300,000 m3/year of MDF and their MDP plant in Montenegro produces 650,000 m3/year. Both plants have four lines to press thermal fused melamine panels with an yearly capacity of 660,000m3.

By purchasing Masisa Brazil, Arauco Group will emerge with an overall capacity of 10million m3/year. This will make it the second largest panel manufacturer in the world. Only Kronospan exceeds it.

"This happens to be a strategic action in line with Arauco´s position as a global corporation facing new challenges. The transaction will strength our offer power both in Brazil and Latin America, bringing about interesting synergy as we have already had an early presence in the Brazilian market," said Matias Demeyco Cassel, vice president of Arauco.

If that were not news enough, new plants are opening: two of them. And, what is the more surprising, they are from two other newcomers to the panels industry – newcomers who may also soon become large players. One is from Asperbras, (trading as Greenplac), the Brazilian industrial giant, whose new MDF plant in Mato Grosso in midwestern Brazil is due on-stream in January 2018.

It is known, among other things, for its involvement in agricultural engineering, and in the food industry, but this is its first venture into wood panels. See our report on page 26 for more.

The other new plant is again from a new and an unusual player in the wood based panels field. Placas do Brasil is the brainchild of SINDIMOL, a grouping of long-established makers of furniture in the region. To source its own raw material, in the form of setting up its own MDF plant, seems a first for such an organisation anywhere.

It is to be built in the city of Linhares in the state of Espirito Santo. The group consists of 38 shareholders, from sectors including furniture and panel retailers as well as furniture manufacturers. The investment is reported as R$393.5m (US$124m) and the capacity will be some 300,000 m3 of MDF per year. Around 18,000ha of eucalyptus will feed the plant and it will employ about 400 people directly and 1500 indirectly.

That three companies are beginning operations that are radically new for them in Latin America shows their confidence that the time is right to tap and unlock the potential of the continent. Latin America lag but it is leapfrogging to the forefront with a vengeance, and offering opportunities on a scale unseen elsewhere, except perhaps in China. It shares some factors with that country. Both are vast; both have large populations, becoming ever more urban and aspiring to join the middle classes, with the housing and furniture needs that that involves. South America has an advantage that China does not: its huge resources in planted forestry. It is the potential of these which are now being realized.

Brazil, for example, is the world’s fifth largest country by area. Its vast and varied forest sector come under the common umbrella of IBA, the Association for the Planted Tree Industry. It is a young association, formed just three years ago, but an important one. We carry on page 28 an article by Elizabete Carvalhaes, CEO of IBA, on the association’s plans and actions, with figures on Brazilian production and potential.

Other giants in the region of course are Duratex, Eucatex, Berneck , Proteak and Arauco. Lest we come away with the impression that everything is recent in the continent, it is worth pointing out that Eucatex, back in the 1950s, produced the first panels from Eucalyptus in the world, the so-called ‘softboard’ or insulating boards. Shortly afterwards they were producing the first acoustic insulating ceiling tiles in South America, and today operate the largest daylight presses in the world.

Not all is rosy, however. It is a continent of many nations, and many economies and markets in many differing states of prosperity or the reverse. In January Tableros Peruanos SA, Peru’s only particleboard mill, went into liquidation and ceased production. It had seemed in a favourable position. Located in Trujillo, surrounded by sugar-cane plantations, it made its panels in large part from sugarcane bagasse. It competed with imports from Ecuador and Chile.

However it not only lost one of its major clients, the Peruvian Martin group, but suffered competition from it when Martin bought a particleboard mill in Spain and began importing and selling.

Such events throw into relief an aspect that we have mentioned before, and hinted at above, but that can get forgotten by outsiders: that Latin America is vast, and is by no means homogenous. Political conditions, economic and market and social conditions vary widely, within countries and within the continent.

Last year in our focus on Latin America we reported that the area was ready to roll. It now seems to be rolling in earnest.

These reports have been researched and assembled by Paulo Cesar Amanthéa, our special correspondent in Latin America, to whom our grateful thanks are due.