Suzano to Build 2.3 Million Tons per Year Pulp Mill in Mato Grosso do Sul, Brazil

May 12, 2021 - Suzano today announced that its Board of Directors approved a capital investment BRL 14.7 billion (approx. USD 2.87 billion) for the construction of a new pulp mill to be located in the municipality of Ribas do Rio Pardo, in the state of Mato Grosso do Sul, Brazil.

The proposed pulp mill, referred to by the company as the "Cerrado Project", will have the capacity to produce 2.3 million (two million and three hundred thousand) tons per year of eucalyptus pulp.

Suzano said the funds for the project will distributed between the years of 2021 and 2024, and estimates that the new plant will start operating in the first quarter of 2024.

The approval and the effective execution of the Cerrado Project are subject to:

(i) the Company's commitment to financial discipline, maintaining compliance with the parameters established in the Suzano's Debt Management Policy; and

(ii) the conclusion of the negotiation of the acquisition of the equipment and services necessary to carry out the project, under satisfactory conditions, to be subsequently evaluated and resolved by the Board of Directors.

Suzano said the project will be financed by the company's cash position and cash generation from current businesses, which can be complemented by financing, provided that the conditions are attractive in terms of cost and term.

In a written statement, Suzano said, "The Cerrado Project represents an important advance in the company's long-term strategy, contributing to the expansion of its structural competitiveness, meeting the growing demand for hardwood pulp and Suzano's evolution in sustainability — especially with regard to climate and waste, providing a major carbon capture increase arising from the new forest base.

"In addition, the new plant will have a surplus capacity for renewable energy generation of approximately 180 MW average, and is also considered in the industry as free from fossil fuel — a new milestone for Suzano in eco-efficiency that shows its commitment to society and the planet."

Suzano is one of the largest integrated eucalyptus pulp and paper producers in Latin America. With operations in nearly 60 countries, Suzano is the world's second largest producer of eucalyptus pulp, one of the ten largest producers of market pulp, and the regional market leader in paper for domestic and commercial use.

SOURCE: Suzano S.A.