Brazil’s pulp industry faces mounting trade pressures as US tariffs affect selected pulp grades, new US trade-duty proceedings target high-purity dissolving pulp, and the European Union prepares to apply its deforestation regulation. The challenges come as Brazilian pulp exports declined in the first half of 2026.

According to the Brazilian Tree Industry Association (Ibá), Brazil exported approximately 9.4 million tonnes of pulp in the first half of 2026, down 10.5% year on year from around 10.5 million tonnes in the same period of 2025. Export revenue fell 4% to approximately US$5.2 billion, while domestic production remained practically stable at 13.9 million tonnes.

Ibá attributed the broader cultivated-tree sector’s export decline to increased protectionism and disruptions to global supply chains. The sector’s total exports, including pulp, paper and wood panels, reached US$7.5 billion during the period, down 5.9% year on year.

US trade measures target dissolving pulp

The United States introduced an additional 25% Section 301 tariff on specified Brazilian goods, effective July 22, 2026. Most wood pulp products were exempted from the additional tariff, but high-purity dissolving pulp was excluded from the exemptions. Consequently, the measure does not affect all Brazilian pulp grades equally.

Separately, on October 13, the US Department of Commerce announced final affirmative determinations in anti-dumping investigations into high-purity dissolving pulp from Brazil and Norway, as well as a countervailing duty investigation into Brazilian imports.

For Brazil, Commerce calculated an estimated weighted-average dumping margin of 6.50% and an adjusted anti-dumping cash-deposit rate of 6.40%. It also determined a subsidy rate of 9.37% for Brazilian imports covered by the countervailing duty investigation.

Bracell Bahia Specialty Cellulose S.A. and Bracell SP Celulose Ltda. were treated as a single entity for the anti-dumping determination. For the countervailing duty investigation, Commerce identified Bracell Bahia Specialty Cellulose S.A. and its cross-owned companies, Bracell Bahia Florestal Ltda., Bracell SP Celulose Limitada and Bracell SP Florestal Ltda.

The determinations do not, by themselves, conclude the proceedings. The US International Trade Commission (ITC) must make the corresponding injury determination. If the ITC finds no material injury or threat of material injury to the US industry, the proceedings will be terminated and cash deposits refunded. If the injury determination is affirmative, Commerce can proceed with issuing duty orders.

EU deforestation rules approach implementation

The European Union’s Deforestation Regulation (EUDR) is scheduled to begin applying to large and medium-sized operators on December 30, 2026. Most micro and small operators have until June 30, 2027, while certain micro and small operators already covered by the EU Timber Regulation face the earlier date.

The regulation covers wood and specified wood-derived products, subject to its product scope and applicable requirements. Companies placing covered products on the EU market must meet the relevant deforestation-free, legality and due-diligence obligations.

For Brazilian pulp producers exporting to Europe, compliance will require appropriate supply-chain traceability and documentation demonstrating that covered products meet the regulation’s requirements. Europe is an important destination for Brazilian pulp, making the implementation timetable commercially relevant for exporters.

With lower first-half export volumes, US trade measures affecting selected products and the EUDR’s application date approaching, Brazilian pulp producers face a changing regulatory and commercial environment. The impact will depend on product grade, destination market, compliance requirements and developments in international demand.