Amorim to plant drip-irrigated cork forests to meet rising demand for stoppersBy Patrick Schmitt
The world’s largest producer of cork stoppers, Amorim, is to begin trial plantations of higher-density, drip-irrigated cork oak forests to speed up production of this slow-growing natural raw material as demand continues to rise.
During an interview with the drinks business in Portugal last month, chairman of the cork company, Antonio Amorim, said that there was an increasingly pressing need to ramp up the supply of cork to meet a growing market for this inimitable material.
As a result, he said that the next stage of his company’s development was to move into the management of cork forests, both through R&D, as well as plantations, to encourage more landowners to consider cork oaks as a source of income in the not-too-distant future.
Although Amorim don’t currently own any cork forests – and buy the bark necessary for cork production on the open market – Antonio told db that he had just received approval from his board members to embark on a project that he said would be “transformational” for the cork industry.
Currently, the returns from planting a cork forest are not appealing because of the long wait before growers are able to harvest the bark from the tree (Quercus suber), which is used to make cork products and stoppers.
The bark of the trees cannot be harvested for cork in their first 25 years, and, once the bark is removed, a nine-year cycle of regeneration is set in motion.
However, the second harvest, when the tree is 34 years old, is not good enough for stopper production, meaning that a cork oak must be 43 years old, when the third harvest is made, before its bark can be used for making stoppers.
“We need people to plant a tree that they will never rest under its shade,” said Antonio, highlighting the problem, which, he said was exacerbated by the fact that today, “people want instant results”.
Continuing he said, “So, how can we make cork a more interesting investment?”
According to Antonio, because the main disincentive to planting cork forests is the length of time before the first harvest, he has put the company’s focus on reducing this initial 25-year period.
“If we can reduce it from 25 to 8-10 years, then planting a cork forest is a much more attractive and competitive proposition,” he said, referencing the alternative woody crop in Portugal, the fast-growing, non-native and invasive eucalyptus.
“With drip irrigation, we have seen the start of the cycle [for cork harvesting] start from eight years, and then the tree can go back to its normal [nine-year] life-cycle, and we can part with irrigation,” he recalled.
Admitting that Amorim has experimented using irrigation to shorten subsequent harvests, even trialling a second harvest after four years, he said that the result was “a disaster”.
On the other hand, moving back to the standard nine-year period having turned off the irrigation, produced cork of the same quality as a tree that had never been irrigated.
“So we only need irrigation to accelerate the first growth phase,” he said.
To put such findings into practice, Antonio said that he was looking right now to rent and buy land in Portugal to plant drip-irrigated cork oaks, which he also said would be planted at higher densities than is the norm in unirrigated forests.
Although he plans to invest in a 3,000ha farm by the end of this year, his aim is much greater.
“I am attempting to get to 50,000ha of additional plantations – by lots of people – over the next 10 years,” which he said would represent 7% of Portugal’s 700,000ha of cork trees, requiring an investment of €150m, based on a cost of €3,000 per ha to plant and irrigate the land.
“We believe that once our example is set, others will create replicas of our model. And from a financial point of view, we will see the value go up a lot with these types of yield – we will plant at 250-300 trees per ha, not 50 trees per ha.”
For this reason, he added, “With 7% more plantations we could grow cork production by 35%.”
He also said that the cost of planting and irrigating the new plantations was subsided to the tune of 1/3 by the European Union.
Continuing, he recorded, “This model could be taken to plant cork anywhere in the world with the right soil and climate conditions.
“It will be transformational for the industry, but we need to test it,” he added.
“We are the world’s biggest expert on cork, but we need to be the world’s biggest expert on cork trees too,” he then stated, admitting that at the moment, Amorim, as a company, owns “zero forestry”.
Such is the scale of this project, Antonio also told db that Amorim would also be creating a nursery to provide the saplings for such extensive plantings, because the state nursery does not have the capacity.
Significantly, Antonio said that none of the devastating forest fires in Portugal last year occurred in cork forests, which are naturally resistant to the spread of wildfires.
Taking place predominantly in eucalyptus plantations, Amorim’s communications director, Carlos de Jesus, told db that the fires, which killed over 100 people in 2017, “have brought new attention to the cork species”.
“If there is something good that came out of this tragedy, then it is that there will be more native species being planted in Portugal at a time when the cork industry needs more cork,” he said.
Meanwhile, explaining the need for greater supply, Antonio said that he saw a “very promising future” for cork in three different areas.
“The first is wine, because we believe that we will continue to capture market share of alternative closures, with most of the growth coming from eroding the market share from plastics,” he began.
Continuing, he said, “70% of our business is stoppers, and we continue to grow, we are outpacing wine industry growth, and the trend of drinking less but better favours us compared to alternative closures.”
As for other sources of growth, he then said, “Secondly, we are seeing some positive growth trends for cork flooring, and the third area of growth is for cork with other composite materials.”
According to Amorim estimates, the market for closures is broken down as follows:
Total: 19.5bn bottles of wine
Cork: 12bn (5.4bn = Amorim corks)