New unit to produce Tissue: Letter Factory will invest $ 1 billion in Aracruz (ES)

4/15/2014-the Brazilian producer of tissue "Factory Letter" is about to start production of a new tissue machine in its factory in Annapolis, in the State of Goiás, Central-Western Brazil. According to the Vice President of the company, José Carlos Coutinho Júnior, the amount invested is 50 million dollars in a project that will double the capacity of the unit to about 60 thousand tons per year of tissue paper. The machine start-up is scheduled for this month.
Originally scheduled to go into operation in December 2013, the machine supplied by Hergen will focus on double-layer toilet paper and towels, in order to meet the growing Brazilian consumer market in regions such as the Midwest and Northeast. "Although Brazil's economic growth is limited, your tissue consumption is increasing at a rate of 6%, followed by other emerging markets. In our case, in 2013 sales were approximately 20% higher than the previous year, "said Chris Júnior to PPI Latin America.
Besides the Annapolis factory, the company also has a unit that produces 29 thousand tons per year of paper in the city of São Gonçalo, Rio de Janeiro, southeastern Brazil.
Future plans
The Industrial Charter announced in 2013 an aggressive goal to become the largest producer of tissue of Brazil, with the goal of competing with global players already installed in the region. To achieve this position, the company announced plans to build a new factory in the city of Aracruz, Espírito Santo state, in a site of 600 thousand m².
Initially, two machines with the capacity to produce 60 thousand tons per year each, should be released in 2015, but Coutinho Júnior signaled that those plans were delayed to 2016. "Our project is to move forward, but we need the installation license to start of construction. We hope to get a license late in the first half of this year and after that we can start the earthworks, "he said.
The Executive also detailed that Factory Letter is still working on the financial structure for the project, which aims to reach a capacity of tissue of 1 billion tons per year until 2024, with 16 machines that operate in Aracruz. The measure would require an investment of $ 1 billion. "We're having conversations, not only with the Banco Nacional de Desenvolvimento Econômico e Social (BNDES), but also with other financing institutions to support this project."
By Marina Faleiros, news editor, PPI Latin America, fgonzalez@risi.com
This report is the PPI Latin America Content. A publication of RISI Opaque about markets and prices of pulp and paper in Latin America. Contact: Louis Sucupira (lsucupira@risi.com) or on the website. http://www.risi.com.