Portugal's new possession was initially called Vera Cruz (“True Cross”), but it was soon renamed Brazil because of the abundant quantities of wood from Brazil (pau-brasil) found there that produced a valuable red dye. The name Brazil is an abbreviated form of Terra do Brasil (Land of Brazil), a reference to the tree of Brazil. The name was given at the beginning of the 16th century to the territories leased to the consortium of merchants led by Ferhão de Loronha to exploit wood from Brazil for the production of dyes for the European textile industry. According to Celtic traditions, the name was given to a mythical island supposedly located off the coast of Ireland.
The island was constantly covered in fog and was almost never visible. If this rule had been followed, an inhabitant of Brazil should have been known (in Portuguese) as a Brazilian. However, after many years, the name became so ingrained in people's minds and mouths that everything related to Santa Cruz was forgotten and Brazil remained in place. It was during Loronha's term of office that the name began to change to Terra do Brasil (Land of Brazil) and its inhabitants to Brasileiros.
Italian merchants from Lisbon, who interviewed returning crews in 1501, recorded their name as Terra dos Papagaios (Land of Parrots). Florentine navigator Amerigo Vespucci joined the next Portuguese expedition in 1501 to map the coast of Brazil. According to Pereira Ferraz, old maps, such as the Atlas of the Medici (133), pointed to two islands with this name. And, in fact, on Tercera Island there is a mountain called Brazil, which perhaps evokes old names.
In 1627, Fray Vicente de Salvador, who was one of the first to reflect on the subject, lamented that the land, which was originally named after the divine wood of the cross, Santa Cruz, was later replaced by Brazil, simply by a so-called wood, a shameless red wood that was used to dye fabrics. This is also due to the Loronha era, when a Brazilian referred to a wood cutter from Brazil, a job that was invariably carried out by the Tupi natives on the coast. The replacement of a name derived from a sacred forest by another derived from a worldly forest was, for him, one of the reasons for the failure of the settlement of Brazil, its social indigence and its economic setbacks. When the messenger arrived in Lisbon, it was quickly renamed Terra de Santa Cruz (Land of the Holy Cross), which became its official name in Portuguese records (when he embraced the coast on his return trip, the messenger must have realized that Brazil was clearly not an island).
Wood from Brazil, which produces an intense red tint, reminiscent of the color of bright embers, was in high demand in the European textile industry and previously had to be imported from India at great cost. The Portuguese term for the Brazilian tree, pau-brasil, is made up of pau (wood) and brasa (ember), the latter referring to the bright red dye that can be extracted from the tree. The label Rio D Brasil (Rio of Brazil) occurs near Porto Seguro, just below the São Francisco River, which almost certainly indicates a river where abundant wood from Brazil can be found on its banks.