While gross profit margins for iron-ore, beef, and soybean producers dropped an average of 4.6% to 18% in the first quarter, margins for pulp makers Suzano Papel & Celulose SA and Fibria Celulose SA rose 9.9% to 36%, on average, data compiled by Bloomberg show.

Brazil’s real lost 17% against the dollar in the three months through March 31, the most among major currencies, as the economy heads toward the worst recession since 1990. While a stronger dollar boosts exporters’ sales in local currency, that’s been countered by even bigger declines in commodity prices and sales volume as costs rise. Not so for paper-ingredient makers whose prices in dollars have risen and shares are among the best performers in Brazil this year.

"The pulp sector is in a very positive time," Victor Penna, a senior equity analyst at BB Securities, stated in the article. "Demand from China has been pretty strong and should remain at high levels in the coming years."

Benchmark pulp prices have gained 5.5% over the past year, compared with a 25% decline in the Bloomberg Commodity Index, as unexpected plant shutdowns in North America and Europe offset new capacity coming online, Penna said.

Strong export demand from China, the U.S., and Europe probably will allow Fibria to increase pulp prices by $20 a ton this month, CEO Guilherme Cavalcanti said in a May 20 interview. "Market conditions indicate that we will be able to implement that hike and generate even more cash," Cavalcanti said. "The exchange rate is the main driver."