Manufacturing plans factory letter $ 1 billion

At the height of a corporate restructuring process and Bill more than $ 500 million a year, the Factory Letter, manufacturer of Deluxe brands of toilet paper and Cotton, diapers and sanitary napkins Diana, put in motion a plan to enter the Group of large global producers of tissue (tissue paper).
The family-owned company, 100% national capital, plans to invest $ 1 billion by 2024 at what would be the largest factory in the world today, with an installed capacity of 1 million tons per year, in the municipality of Aracruz, Espírito Santo alongside a unit of Fibria, the main producer of bleached eucalyptus pulp.
The challenge is great, but the project, with implementation by modules, fit to market movements over the 12 years of implementation. Today, the Factory produces Letter 54 fluminense thousand tons per year of tissue paper into two units in São Gonçalo (RJ) and Annapolis (GO), and is much smaller than the first three national ranking: the American Kimberly-Clark, the Brazilian Santher and the Improvements, national company that was purchased by Chile's CMPC. In addition, the future State will have factory, alone, almost the size of the total installed capacity of tissue in the country currently, 1.2 million tons per year.
In the first phase of the project, which comes into operation in 2015 with a capacity of 120 thousand tons per year, the company will invest r $ 400 million from own resources and of third parties. Lines of credit or other financing operations of Banco Nacional de Desenvolvimento Econômico e Social (BNDES), The Participation of international agencies and export financing-and, in the future, an offer of shares are among the alternatives considered by the Industrial Letter.
The plot of 550 thousand square meters in Aracruz is already being prepared for future expansion-in December, was issued the licence and industrial licensing can leave in six months. In all, will be eight modules, with two machines and ability to 120 thousand tons of tissue. "Let's start with 120 thousand tonnes per year in 2015 and, gradually, we will install the other seven modules, with additional investments of $ 800 million," said the value of the financial Vice President of Factory Letter, Marcos Cattan.
Before relying on the additional production of Aracruz, Factory Letter will increase by about 50% its installed capacity, or 24 thousand tons per year, from an investment of r $ 45 million in Goiás. "I do not know how to respond to customers, asking for more paper. We are completely taken with machines, "said the founder and President of the company, José Carlos Coutinho.
This project will be operational in 2014 and will contribute to the company's gross revenues exceed $ 500 million in the year, against r $ 360 million estimated for 2013. Last year, the turnover of the Manufacturing Letter was just above $ 300 million. So far, sales have been concentrated in Rio de Janeiro and in the Midwest. With larger capacity, the company plans to seek customers including abroad.
The consistent growth of absorbent paper consumption in the country in the wake of the improvement of Brazilian's income, and the move to premium products, such as the double leaf, support the ambitious plans of the company. Especially in emerging markets, packaging paper and tissue represent great opportunities to the industry in the coming years, according to the study of Pöyry group unit Management Consulting Pöyry, which is one of the leading providers of engineering services in the world to the sector.
Worldwide, the average rate of growth of tissue consumption was 3.8% between 1991 and 2010, according to a report published last year by the consultancy Risi, reference to the global paper industry. Until 2021, the expectation is that demand advance in pace top 4.1% per annum. The Risi, however, pointed out the risk of fall in occupancy rate of tissue from 2013, before expanding investments mainly in China, Latin America and North America.
The possibility of export of the product-which traditionally is directed to the domestic market – also justifies a plan of this magnitude, as Chris. "We will be on the side of the supplier of the raw material and the 1.5 kilometre from the port [Portocel, specialized in cellulose terminal]," explained Chris. "With this structure, we can ship the paper in reels and put a conversion unit in desired markets."
Today, Fibria and Suzano Papel e Celulose are suppliers of raw materials used for Manufacturing Letter-there were also tests with fiber from Eldorado Brazil pulp. In the future, due to the location of the new plant tissue, is likely to win even more relevance Fibria on purchases.