A US$8m plan to build a small fibreboard mill in Paraguay’s department of Caaguazú has been approved by the country’s Industry and Commerce Ministry.

The proposed facility with a reported installed capacity of 55,000m3/year is to be constructed by a national company, Agroindustria del Paraguay SA. It will be the firm’s first venture in wood panel manufacturing.

Its new operation, among eight investment schemes to receive the ministry’s green light, will be located in the town of Coronel Oviedo and MDF output will be aimed at export to neighbouring Brazil. Agroindustria is expected to generate around US$6m/year in foreign trade, according to national media reports.

Paraguay’s new producer will take advantage of fiscal incentive legislation for national and foreign investors to assist its investment of US$6.7m in importing machinery for the plant.

Today, Paraguay’s domentic demand for MDF is satisfied from fibreboard imports from Brazil and from China.