Growth in Demand for Cork Sends Amorim Back to the Forests

Growth in Demand for Cork Sends Amorim Back to the Forests

With the current global demand for cork stoppers surpassing 12bn units annually and the wine market’s upward growing curve, the world’s leading cork-company Amorim is going back to basics to ensure sufficient supply of quality product for the years ahead. And by going back to basics we are talking about the source of cork, namely the quercus suber, also known as the cork oak tree. Speaking to the popular Grandes Escolhas Magazine, Antonio Amorim, president of Amorim Cork told of the company’s plans to ensure unhindered supply of product from a new generation of cork forests.

“At the moment, the situation between the supply of natural product from cork forests and our customers’ demand is balanced,” he said. “Portugal has 34% of the area, but 50% of the production of raw material. The production of cork is thus not scarce, but adjusted to the level of actual demand. We cannot forget that in the decade of 2000 to 2009 cork lost an important share in the world of wine to artificial closures. If the cork market had during that time continued to grow at the same pace as today, there would now indeed be a mismatch between supply and demand.”

According to Amorim, the question of sufficient supply arises not in the short term, but in the long run. “Cork is showing huge growth potential plus – being Amorim – we are ambitious about furthering this growth. Because the origin of the supply chain is in the forest, it takes decades to get a tree up and running, supplying class bark for quality stoppers. If we do not start now to plan this part of the supply chain, we are definitely going to find an imbalance between supply and demand in the decades ahead.”

The anomaly is that there has never been such a large area occupied by cork oaks in Portugal and – at the same time – cork production has never been so small. “The problem is not in the occupied area, but in the existing density,” says Amorim. “There has been some rejuvenation and we will soon enter a period where we can benefit from the plantations developed in 1995 and 2000, cork trees only starting their production cycle after 25 years.”

Antonio Amorim

He stresses the number one concern: “Today there are fewer people investing in a business cycle with a turnaround of 25 to 30 years,” says Amorim. “A forest owner no longer invests in plantations for his grandchildren, as was the case before. We therefore must find a way to make the cork tree a more economically interesting species for the forest producer. At the same time, it is necessary to renew the supply of existing cork forests and make the cork tree give a better and faster return to the producer.”

And now for the million dollar question: How can one shorten the production cycle of cork oak? “Through a drip irrigation system at a specific point in the tree’s growth cycle,” says Amorim. “Up to now, cork forests were never irrigated. By introducing irrigation we have been able to accelerate the initial growth cycle of cork oak from sapling to the first harvest from 25 to 10 years. This model has now been tested by Amorim in certain forests, validated by scientific results.”

Amorim stresses that the acceleration of growth through irrigation is only for periods of the initial cycle of the cork tree until the first stripping of the bark, which is not of the quality sought for cork stoppers. After the first strip at nine to 10 years, irrigation is completely removed and the cork tree follows its normal cycle. This ensures the cork has, in the second, third and future extractions, the normal and required cell density and characteristics for stopper use.

“We are thrilled with the initial results,” says Amorim, “to such an extent that we have recently purchased a large estate to test this technology on a much larger scale. We will plant in 2019, 2020 and 2021 and then accelerate the cycle until the first extraction, returning to the normal cycle of 9 years. (Amorim recently announced the purchase of Herdade da Baliza for 5.5 million euros, an agricultural farm with 2 866 hectares, in Castelo Branco).
More importantly for the Portuguese landscape, is that Amorim foresees more forest-owners planting cork oak trees now that a quicker turnaround in the harvest cycle is possible.

Harvesting a cork tree.

“Some producers invest in eucalyptus because currently it has a higher yield than that of cork,” says Amorim. “Emotionally I am sure that, based on a similar (or even higher) profitability, the forestry producer will prefer the cork oaks. The cork oak is an autochthonous specie, adapted to the climate and soils here, and provided that there is some water availability to get the tree’s engine started, planted cork oak forests will be an excellent investment alternative.

“Compared to the spontaneous plantations that evolved naturally – which currently represents 90% of the forests in the Alentejo region – a planted cork forest can offer a surface density up to seven times higher, with the enormous gains resulting therefrom. In Portugal, we have a density of 50 trees per hectare, which is very low, and we can go up to 250 or 300 trees. All this is being supported by an intense investigation and knowledge development. Amorim is the entity in the world that knows the most about cork. But we now want to be the one who knows the most about cork oaks. We are working very hard towards this.”