Tuesday, October 30, 2018

Suzano pulp market sees balanced

Suzano assesses that you can complete the operation of integration of rival Company between December and the first two weeks of January next year, freeing the company to discuss the future growth of the combined group at a time when the supply and demand scenario pulp in the world is balanced. "The company will have the potential to generate significant cash, deleveraging is faster than expected, it creates a greater level of flexibility to discuss optionality clauses ... and the organic growth is one of the optionality clauses that we have," said the Chief Executive of Suzano, Walter Schalka, in a teleconference with journalists. The company unveiled the day before a cash generation as measured by earnings before interest, taxes, depreciation and amortization (Ebitda) record, jumping 78,6% about a year earlier, to 2.118 billion reais. The discussion about the company's options from next year will include the future scenarios of supply and demand of pulp in the world. According to Schalka, for the fourth quarter, at least, global markets are balanced between supply and demand, but stocks in the sector are high, which can generate "volatilities" in discussions of prices with customers. Shares of Suzano had 4,8% crash at 12:05, while the Ibovespa retreated 0,5%. Fibria's representatives also quoted on Wednesday, high stocks of pulp in global and potential price volatility between customers, but attributed the situation to the entry of new production capacity of paper in recent months, which naturally require more raw material. Asked whether an entry of the company in the market of paper for packaging could be one of the options that will be in front of the Suzano upon completion of the merger of Fibria, Schalka stated that Suzano prefers to be in markets where it can be competitive. This was what led the company into the consumer goods segment, with sanitary papers, "but I don't see how competitive packaging terms because we don't have long fiber," said the Executive, referring to the raw material for the production of cardboard. On the eve, International Paper announced that it is considering selling your packaging production facility in Brazil, whose main rival is the current supplier of Klabin pulp part sold by Fibria. On Sunday's election in Brazil, Schalka said that whatever the victorious candidate, Fernando Haddad (EN) or Jair Bolsonaro (PSL), the next Government should work to "pacify the country from Monday" and have as one of the priorities strengthen the role of Brazil "leader in global environmental issue, preserving the environment and the Amazon".
Tissue on line - 29/10/2018 News Item translated automatically
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