The Brazilian Suzano officially announced a new pulp plant in Ribas do Rio Pardo City, in Campo Grande State. The plant’s annual production capacity is 2.3 million tons of eucalyptus pulp and it will start to work until the end of the 1st quarter of 2024.
The project estimates industrial investments of R$14.7 billion (USD 2,79 billion approximately at the current exchange rate), making it one of the most significant private-sector investments currently under development in Brazil.
The initiative, called “Cerrado Project”, will expand Suzano’s current pulp production capacity, of 10.9 million tons, by approximately 20%. The industrial unit in Ribas do Rio Pardo also will be the company’s most competitive.
“The new plant represents an important advance in our long-term strategy. Suzano is already part of the lives of over 2 billion people through its products and, as a global leader, is committed to meeting the world’s growing demand for products from renewable materials. The project will also make an important contribution to income generation and job creation in the region while increasing our carbon capture capacity, thanks to the expansion of our forest base,” said Walter Schalka, CEO of Suzano.
The new plant will also contribute to mitigating the effects of climate change, involving the expansion of renewable energy supply in Brazil. The plant will have the capacity to sell approximately 180 MWave of surplus energy to Brazil’s power grid. The unit should become Brazil’s first fossil-fuel-free pulp and paper plant, representing a new milestone in eco-efficiency and effectiveness.
This project will result in the world’s largest plant with a single eucalyptus pulp production line, which is still subject to conditions precedents, such as complying with the company’s Financial Policy and negotiation parameters with suppliers. The primary funding source of the project will be Suzano’s cash generation, which could be complemented by financing, provided the cost and term conditions are attractive.
The project should create around 10,000 direct jobs during the peak of construction. After its conclusion, the new unit is expected to employ 3,000 people and support the region’s entire economic chain development.