How INCAPE reinvented itself to meet the high demand of the paper market

In 2020, the tissue market experienced a huge increase due to the Covid-19 pandemic. The corestock sector followed the same pace, with an increase in demand. In this sense, companies such as INCAPE, a Brazilian company specialized in the production of corestock for the tissue segment, had to adapt to this scenario to meet an increasing number of orders.

The company reacted in advance to this trend, which allowed it to continue serving all its customers. “We analyzed the foreign market to understand how Brazil would react. Overseas, markets were consuming toilet paper in an overwhelming way. Thus, we ended up contacting all customers and our partners, who were very concerned. We reassure them and are committed to continuing to meet the demand. We anticipate our Maintenance Control Planning in a much more active way, reducing downtime, which has brought us much more productive capacity. Thus, we ended up breaking a production record for some months in the year 2020 and managed to further solidify ourselves in the market. This is an achievement both for our clients, who trusted in our work, and for our team, internally, for all their efforts,” said Thiago Karam, INCAPE’s executive director, in Talk Tissue with Felipe Quintino.

Thiago also commented on the way that INCAPE has been dealing with the scarcity of brown shavings, the main raw material for the manufacture of corestock. “It is not easy to fight with the big recycling companies in the country. In our region, we have a very interesting participation, but the price is national, so, from the moment that there was a very large demand in the fluting paper market – what happened because of the pandemic, during the lockdowns – there was an imbalance: very low supply and very high demand, rising prices. The impact this had on our COGS (cost of goods sold) in one year was more than 185%. So, we set out to look for solutions, alternatives, open borders to seek quality in this product, because it is not enough just to increase the price conditioned to the high demand of the material and drop the quality drastically. A little different from the fluting paper market, our corestock paper requires a noble raw material, of a much higher level today than the market is used to. So, searching for this raw material in the domestic market has become very difficult”, he explained.

Again, anticipating trends, INCAPE sought partnerships abroad to meet this need. “We have been importing a considerable volume of brown shavings from Guatemala, Panama, United States, in a very active way, so that we can achieve a level of quality that our product requires. This is the anticipation of the problem, because today, the price is still very unstable – all markets have their variations, but they are still generally heated, and this implies an increase in the cost of chips. In addition, the quality of the material has deteriorated a lot in recent times,” he says.

In the tissue market, which also uses chips, there was also a big drop due to social isolation and the working from home, in addition to the digitization process. “For the first time in the history of the paper industry in Brazil, white shavings are cheaper than brown shavings. We also monitor the cost of cellulose, which has a very direct impact on tissue production. It’s not easy for anyone. For this reason, we strongly believe in this issue of partnership, of being able to count on your supplier, being able to count on your client so that the production schedule, of importation, as is our case, agrees. This was what we most benefited from in this pandemic: in addition to all unity, all strength as humanity; in business, partnerships have become much more solid”, he observes.

Last year, INCAPE also announced major investments, which continued despite the pandemic, and should be carried out in the medium term. “Our biggest project is the partnership between INCAPE and HERGEN, a stoppage scheduled for the beginning of 2022, but it is a job that has been done since the beginning of this year. With this investment, we will have an increase in our paper margin considering relative gains in production, cost reduction. We also have other infrastructure projects to expand the administrative, production, new cafeteria, all to run within 2021. And some other projects in the preparation of paper pulp, an area that is truly relevant for us to be able to reach the best role for conversions. INCAPE, today, understands the responsibility it has for the market positioning that it has taken, therefore, investments are necessary for the company to remain at the forefront of card paper operating in Brazil and Latin America”, he evaluates.

Finally, Thiago commented on INCAPE’s social projects with the community. “It has always been our goal to look for what we can deliver not only for employees, but for our community. Within INCAPE, we have the ethics committee, the university of behavior project, some work fronts that seek quality of life for employees first, something essential in an industry, and our responsibility is to be able to deliver this in the most efficient way possible and show it to the company. community that the company has a responsibility to improve its neighborhood, its city”, he declares.

Recently, the company announced an incentive to sport with the sponsorship of a basketball team. “We have sponsored some sports in our region, such as swimming and BMX. Sports, perhaps not as highly visible in our country as football. The Flamengo team, well known in basketball, set up a basketball pole in the city of Blumenau, which is nearby. Today, INCAPE has become one of the master sponsors of this team, which plays the Brazilian basketball championship, is already qualified for the second phase of the championship, and we were very happy to be able to be together in the project. We seek not only to professionalize the sport, not only to sponsor, but in some way to help sport management with business management. We hope that the team will be champion and qualify for NBB (Novo Basquete Brasil), the first national basketball league. Supporting sport is in our vein and it will not come out anymore”, he concludes.