UPDATE 1-Pulp prices to rise on Chile quake, Suzano says

* Chile earthquake to restrain supply, says Suzano CEO

* Tighter pulp market, short-term price rise seen

* Quake shuts 3.7 mln tonnes of capacity in Chile (Recasts to add details, comments, byline)

By Carolina Marcondes

SAO PAULO, March 3 (Reuters) - Global pulp prices will likely spike in the short term because the Feb. 27 earthquake in Chile could cut inventory and output, the chief executive of Brazilian pulp processor Suzano (SUZB5.SA) said on Wednesday.

Chile, which accounts for 9 percent of the world's pulp output, suffered an 8.8 magnitude quake that disrupted roads and ports and hampered power supply. Most of Chile's pulp plants are in the south, near the quake's epicenter.

Turnover in global pulp supplies, now at about 30 days, should decline amid a tighter market, Antonio Maciel Neto told Reuters in an interview. Turnover rates are about 35 days in "normal times," he added.

"Chile produces about 4.8 million tonnes annually, of which about 4 million tonnes come from the affected region," he said. "Because of its geographic location, Chile supplies China with a lot of pulp."

Shares of Suzano rallied on Wednesday, gaining 5.1 percent to 21.39 reais in Sao Paulo, the third straight daily gain of more than 4 percent.

The global pulp and paper market is recovering after a deep tumble at the start of 2009 and companies around the world boosted output as prices rose worldwide. Producers raised prices in Brazil at least six times last year.

Global pulp inventory fell to the lowest level in more than seven years at the end of the third quarter due to China's growing need for fiber to accommodate urbanization.

Hardwood pulp prices are around $750 a tonne and they could rise to $800 in the short term, according to Itau Securities analyst Marcos Assumpcao. Brazil and Chile are the world's largest producers of pulp, respectively.

Copec's COP.SN Arauco forestry unit and CMPC CAR.SN are the largest Chilean pulp companies. CMPC, controlled by Chile's Matte family, last year agreed to buy the Guaiba compound from Brazil's Fibria for $1.4 billion.

Fibria is the world's biggest supplier of pulp for makers of paper.

CMPC dropped 0.3 percent to 21,787 Chilean pesos, extending losses for a third day. Copec shares plummeted 4.3 percent to 7,567.50 pesos on Wednesday.

(Additional reporting and writing by Guillermo Parra-Bernal; Editing by David Gregorio)