Suzano will invest R$720 million in projects to diversify and capture operating gains in 2017

The investments will be allocated to launching tissue and lignin production, debottlenecking the Imperatriz Unit and modernizing the wastewater treatment plant at Mucuri

Our company will invest around R$720 million by year-end in a set of projects to diversify our operations through higher-value products, boost our structural competitiveness, cut costs and enhance our environmental initiatives. The investments will be used to build two tissue lines, one at the Mucuri Unit in Bahia state and the other at the Imperatriz Unit in Maranhão state, and to build a lignin production line at the Limeira Unit in São Paulo state. The project to debottleneck the Imperatriz Unit also will be concluded this year, as will the projects to expand and modernize the wastewater treatment plant and to install a new crystallizer on Line 2, both at the Mucuri Unit.

These projects are included in our investment plan for 2017, which is estimated at R$1.83 billion and also includes R$1.11 billion in maintenance initiatives, including in the forestry and industrial operations. The maintenance investments aim to ensure the good operating conditions of our assets, as well as to cultivate and preserve green areas.

The production of tissue and lignin, whose startup is slated for this year, represents another step in our strategy to diversify the returns on our asset base, with the opening up of new avenues of adjacent businesses by capturing efficiency and profitability gains in our operations.

After the startup, in 2015, of the production of eucalyptus-based fluff pulp, a pioneering product at the global level, we also will launch the production of tissue, also known as sanitary paper. This product, which is used, for instance, to make toilet paper and tissues, will supply primarily markets in Brazil’s North and Northeast.

We also will invest in the production of lignin, a sub-product of the pulp manufacturing process that can be used to substitute petroleum-based products in high-value applications. Considered a new technological frontier in the pulp and paper industry, lignin applications, which currently are limited to power generation, could emerge in the construction and furniture industries, for example.

Both projects, like Eucafluff, the eucalyptus-based fluff pulp made at the Suzano Unit, represent our advances into adjacent businesses. This is one of our three strategic pillars, which also includes Structural Competitiveness and Redesigning the Industry. “We are very motivated with the advances made in our adjacent businesses. These are growth avenues that will reduce Suzano’s exposure to exogenous factors, such as foreign exchange rates and international pulp prices,” said Walter Schalka, our CEO.

Productivity

In addition to Adjacent Businesses, the pillar Structural Competitiveness also will receive new investments in 2017. Once the debottlenecking of the Imperatriz Unit is concluded, the annual capacity of local production will expand from 1.5 million to 1.65 million tons of pulp.

This year, we also will conclude the project to modernize and expand the wastewater treatment plant at the Mucuri Unit, which will allow us to improve the quality of the water discharged into the Mucuri River.

Another ongoing investment this year is the installation of a new crystallizer at the Mucuri Unit, which will optimize the consumption of chemical inputs for pulp production on Line 2.