Pulp & Paper in Chile Regulatory Changes Analysis¶

Potential Regulatory Changes¶

Based on the analysis of the Chilean Pulp & Paper industry value chain, several areas are prone to potential regulatory changes, primarily driven by existing challenges and increasing global and domestic pressures related to environmental sustainability, social equity, and resource management.

A key area for potential regulatory evolution lies within Forestry. Given the persistent environmental and social conflicts highlighted in the Value Chain Report concerning large-scale monoculture plantations, regulations could tighten regarding land use, particularly in proximity to native forests and indigenous territories. This could involve stricter rules on plantation expansion, requirements for buffer zones, mandates for the restoration of native ecosystems, and more rigorous processes for obtaining permits on certain lands. Furthermore, regulations around water usage by plantations are likely to intensify due to concerns about water scarcity and the impact on local communities and agriculture. This could lead to limitations on water extraction or requirements for more efficient irrigation techniques. Socially, regulations might evolve to mandate more robust consultation processes with indigenous and local communities, potentially granting them greater influence over forestry operations impacting their ancestral lands or livelihoods. [See Value Chain Report - Bottlenecks and Challenges, 1]

In Pulp Production, environmental regulations are expected to become more stringent concerning emissions and waste management. While the industry has invested in pollution abatement, increasing global standards and local concerns about air and water quality around mill sites could lead to lower permissible limits for pollutants, stricter monitoring requirements, and potentially new regulations on the handling and disposal of chemical byproducts. [See Value Chain Report - Bottlenecks and Challenges, 4] Water discharge quality and volume are also likely areas for increased regulation, especially in water-stressed regions.

The Recycling segment, though noted as growing, could see regulatory changes aimed at promoting a more circular economy. This might include government incentives or mandates for increased collection and utilization of recovered paper, setting minimum recycled content targets for certain paper and board products, and developing clearer standards for sorted recovered paper grades. [See Value Chain Report - Value Chain Definition, 6] Extended producer responsibility schemes, where producers are responsible for the end-of-life management of their products, could also be introduced or expanded, impacting the economics and logistics of collecting and processing waste paper.

Across the entire value chain, regulations related to climate change mitigation and adaptation are likely to emerge or strengthen. This could involve carbon pricing mechanisms, requirements for reporting greenhouse gas emissions, and incentives for renewable energy generation beyond current levels. Adaptation strategies might also become subject to regulation, such as mandates for fire prevention measures in plantations or requirements for assessing and mitigating the impact of water scarcity.

Finally, changes in international trade regulations and standards driven by environmental or social concerns in key export markets could indirectly impact the Chilean industry. This could include stricter requirements on the traceability and legality of wood fiber, carbon footprint labeling on pulp and paper products, or tariffs related to environmental performance.

Table of Potential Impact of Regulatory Changes¶

Potential Regulatory Change Area	Specific Change	Potential Impact on Value Chain Stage(s)	Potential Impact on Players	Potential Impact on Commercial Relationships
Forestry	Stricter land use rules, buffer zones, native ecosystem restoration mandates.	Forestry (Plantation Management, Harvesting)	Increased operational costs for land management, potential limitations on expansion, need for new land management practices.	Impact on relationships with independent forest owners (if expansion is limited), potential for new service providers in restoration.
Forestry	Tighter regulations on water usage by plantations.	Forestry (Plantation Management)	Need for investment in water-efficient technologies, potential impact on plantation yields in water-stressed areas, increased monitoring costs.	May require new relationships with water management technology providers.
Forestry	More robust consultation processes with indigenous and local communities.	Forestry, potentially Pulp Production (if leading to disruptions).	Increased time and resources for community engagement, potential delays or limitations on projects, need for conflict resolution mechanisms.	Development of more formal agreements and negotiation processes with community representatives.
Pulp Production	Stricter limits on air and water emissions.	Pulp Production	Significant investment required in new abatement technologies and monitoring systems, increased operating costs.	Stronger relationships with environmental technology and service providers.
Pulp Production	Stricter regulations on handling and disposal of chemical byproducts.	Pulp Production	Increased costs for waste management, potential need for new treatment or recycling facilities.	Changes in relationships with chemical suppliers and waste management companies.
Recycling	Incentives or mandates for increased collection and utilization of recovered paper, minimum recycled content targets.	Recycling, Paper Manufacturing, Converting.	Increased demand for recovered paper, need for investment in recycling infrastructure, potential changes in paper production processes and product offerings.	Growth in commercial relationships with waste management companies and suppliers of recovered paper. Development of new markets for recycled-content products.
Recycling	Extended Producer Responsibility (EPR) schemes for paper and board products.	Converting, Distribution, Recycling.	Increased costs for producers related to end-of-life management, need for new collection and processing systems.	Development of collaborative relationships across the value chain for product take-back and recycling.
Cross-Chain	Carbon pricing mechanisms, GHG emissions reporting requirements.	All stages (Forestry, Pulp Production, Paper Manufacturing, Converting, Distribution, Recycling).	Increased operating costs, need for carbon footprint measurement and reporting systems, incentives for emissions reduction.	Potential for new commercial relationships related to carbon offsets or trading.
Cross-Chain	Regulations promoting renewable energy generation and climate adaptation strategies.	Forestry, Pulp Production (Energy Generation), potentially other stages.	Investment in renewable energy projects, implementation of adaptation measures (e.g., fire prevention), potential eligibility for government support.	Strengthened relationships with renewable energy technology providers.
International Trade	Stricter requirements on traceability, legality, carbon footprint, or environmental performance in export markets.	Forestry, Pulp Production, Distribution.	Need for enhanced tracking and reporting systems, potential impact on market access or competitiveness, need for product labeling/certification.	Increased requirements from international customers regarding sustainability documentation and compliance.

References¶

Opportunities and challenges for pulp and paper industry in South America - SIFI (2013-04-03)
CMPC Pulp > Home-us [https://www.cmpcpulp.com/home-us/]
Chile – Modest T&T business with recent growth - Tissue World Magazine (2015-05-29) [https://www.tissueworldmagazine.com/articles/chile-modest-tt-business-with-recent-growth/]
Empresas Coipsa converts former BO Paper newsprint mill in Chile to containerboard (2022-05-26) [https://www.risiinfo.com/industry-news/packaging/empresas-coipsa-converts-former-bo-paper-newsprint-mill-in-chile-to-containerboard/]
Environmental Life Cycle Assessment of Bleached Pulp from Eucalyptus: Chilean Case [https://iopscience.iop.org/article/10.1088/1755-1315/1206/1/012004]
CMPC Pulp > About [https://www.cmpcpulp.com/about/]
Products - Packaging | InterlogChile [https://www.interlogchile.cl/productos/packaging/]
Chile: Tree plantation companies and indigenous rights, a longstanding conflict (2014-03-07) [https://wrm.org.uy/articles-from-the-wrm-bulletin/section1/chile-tree-plantation-companies-and-indigenous-rights-a-longstanding-conflict/]
Overview - The Company - Empresas CMPC S.A. [https://www.cmpc.com/en/about-us/overview/]
Sonae Arauco subscribes first funding linked to sustainability performance [https://www.sonaearauco.com/en/news/sonae-arauco-subscribes-first-funding-linked-to-sustainability-performance/]
Planted forest : The big opportunity for forest recovery in Chile and Uruguay (2019-02-26) [https://www.fao.org/fao-stories/article/en/c/1182225/]
Sonae Arauco signs its first sustainable financing agreement amounting to €184 million, led by CaixaBank (2022-04-18) [https://www.caixabank.com/comunicacion/noticia/sonae-arauco-signs-its-first-sustainable-financing-agreement-amounting-to-eu184-million-led-by-caixabank_en.html?id=127833]
Overview of the Pulp and Paper Market - Newspulpaper [https://www.newspulpaper.com/overview-of-the-pulp-and-paper-market/]
Arauco | SPOTT.org [https://www.spott.org/palm-oil/arauco/]
Profile - CMPC - celulosa [https://celulosa.cmpc.com/perfil/]
Ametro Sarl- Paper manufacturers & suppliers Chile [https://www.ametrosarl.com/chile/paper-manufacturers-suppliers]
La Industria Forestal de ChileChile's Forestry Industry - AmCham Chile [https://www.amchamchile.cl/wp-content/uploads/2015/09/la-industria-forestal-de-chile.pdf]
Environmental Life Cycle Assessment of Bleached Pulp from Eucalyptus: Chilean Case [https://iopscience.iop.org/article/10.1088/1755-1315/1206/1/012004/pdf]
Environmental Life Cycle Assessment of Bleached Pulp from Eucalyptus: Chilean Case (2024-10-24) [https://iopscience.iop.org/article/10.1088/1755-1315/1206/1/012004/meta]
The South American Pulp and Paper Industry: The Cases Brazil, Chile, and Uruguay (2024-11-21) [https://link.springer.com/chapter/10.1007/978-3-030-90719-9_11-1]
Compañía Manufacturera de Papeles y Cartones (CMPC) - BankTrack [https://www.banktrack.org/company/compania_manufacturera_de_papeles_y_cartones_cmpc]
Pulp & Paper - Manuchar [https://www.manuchar.com/industries/pulp-paper/]
Chile Paper Industry Suppliers and Exporters | Manufacturers, Wholesale Dealers, Trading Companies in Chile | B2B Directory Online | PaperIndex [https://www.paperindex.com/chile/]
Sustainability at Sonae Arauco: Business Practices [https://www.sonaearauco.com/en/sustainability/business-practices/]
Arauco's 2100000 TPA Pulp Producing Paper Mill in Chile becomes Operational (2022-07-13) [https://www.paperinfonews.com/news/mills/araucos-2100000-tpa-pulp-producing-paper-mill-in-chile-becomes-operational]
Chile - Food and Agriculture Organization of the United Nations [https://www.fao.org/countryprofiles/index/en/?iso3=CHL]
Unasylva - Vol. 6, No. 2 - The work of FAO [https://www.fao.org/forestry/unasylva/8582/en/]
ANDRITZ Chile Ltda [https://www.andritz.com/group/locations/south-america/andritz-chile-ltda]
CMPC Pulp > Products [https://www.cmpcpulp.com/products/]
How we're tackling challenges in the pulp and paper industry - Earthworm Foundation [https://www.earthworm.org/our-work/sectors/pulp-paper]
Innovation at the core - Empresas Copec [https://www.empresascopec.cl/en/innovation-at-the-core/]
List of paper mills - Wikipedia [https://en.wikipedia.org/wiki/List_of_paper_mills]
Products - Raw Materials | InterlogChile [https://www.interlogchile.cl/productos/materias-primas/]
Forestal Arauco - Soil stabilization and dust control success case in Chile [https://www.tci.cl/wp-content/uploads/Soil_Stabilization_and_Dust_Control_Success_Case_in_Chile.pdf]
Based in Chile, Arauco is one of the largest forestry - Microsoft [https://microsoft.gcases.org/case/arauco/Based-in-Chile-Arauco-is-the-largest-forestry-html]
Stable outlook for pulp and paper industry - PEFINDO (2023-07-05) [https://www.pefindo.com/news/news-detail/Stable-outlook-for-pulp-and-paper-industry/2331]
Chile Pulp Market (2020 - 2026) | Trends, Outlook & Forecast - 6Wresearch [https://www.6wresearch.com/industry-report/chile-pulp-market]
Cost inflation weakens across Latin American paper products supply chain - Fastmarkets (2025-01-06) [https://www.fastmarkets.com/insight/cost-inflation-weakens-across-latin-american-paper-products-supply-chain/]
Chile's Chemical Wood Pulp Market Report 2025 - Prices, Size, Forecast, and Companies [https://www.reportlinker.com/p06955406/Chile-s-Chemical-Wood-Pulp-Market-Report-Prices-Size-Forecast-and-Companies.html]
Arauco - Corporate Presentation 3Q 2018 [https://www.arauco.cl/wp-content/uploads/PRESENTACION-CORPORATIVA-ARA-3T18-ESP.pdf]
Corporate Presentation - ARAUCO [https://www.arauco.cl/wp-content/uploads/ARAUCO-Presentacion-Corporativa.pdf]
Pulp & Paper Enzymes Market Share & Size Report, 2023-2032 - Global Market Insights [https://www.gminsights.com/industry-analysis/pulp-and-paper-enzymes-market]
Top 8 Wood Pulp Companies in the World - Expert Market Research [https://www.expertmarketresearch.com/blog/top-8-wood-pulp-companies]
Pulp & Paper Chemicals Market Share, Size and Industry Growth Analysis 2022-2027 [https://www.gminsights.com/industry-analysis/pulp-and-paper-chemicals-market]
Chile, pulp and paper industry's war on the poor (2024-06-21)
Major pulp producers in Latin America have high expectations for their process data analysis - Trimble Wedge
Empresas CMPC (CMPC.SN) - Revenue - Companies Market Cap [https://companiesmarketcap.com/cmpc/revenue/]
Empresas CMPC (CMPC.SN) - Revenue - Companies Market Cap [https://companiesmarketcap.com/cmpc/revenue/]
Empresas Copec And Celulosa Arauco Ratings Affirmed On Expansion (2024-09-27) [https://www.spglobal.com/ratings/en/research/articles/240927-empresas-copec-and-celulosa-arauco-ratings-affirmed-on-expansion-16203056]
First bale produced at Arauco MAPA project in Chile - Valmet (2023-01-25) [https://www.valmet.com/media/news/press-releases/2023/first-bale-produced-at-arauco-mapa-project-in-chile/]
Celulosa Arauco y Constitucion S.A. (2024-06-13) [https://www.sec.gov/Archives/edgar/data/0000897937/000110465924070725/tm2417636-1_20f.htm]
Masisa (SNSE:MASISA) Stock Price & Overview - Stock Analysis [https://stockanalysis.com/snse/masisa/]
Masisa S.A. Reports Earnings Results for the First Quarter Ended March 31, 2024 - Stock Market (2024-04-26) [https://www.marketscreener.com/quote/stock/MASISA-S-A-10433433/news/Masisa-S-A-Reports-Earnings-Results-for-the-First-Quarter-Ended-March-31-2024-46577181/]
ARAUCO-INTEGRATED-REPORT-2023.pdf [https://www.arauco.cl/wp-content/uploads/ARAUCO-INTEGRATED-REPORT-2023.pdf]
The Company | Empresas CMPC S.A. [https://www.cmpc.com/compania/]
Celulosa Arauco y Constitucion S.A. Company Profile - Chile | Financials & Key Executives [https://www.dnb.com/business-directory/company-profiles.celulosa_arauco_y_constitucion_sa.c5f9648edc577011f5b158e85d2534f3.html]
Masisa S.A. Stock (MASISA) - Quote Santiago S.E.- MarketScreener [https://www.marketscreener.com/quote/stock/MASISA-S-A-10433433/]