THE LATIN AMERICAN PULP GIANT EMERGING AS A MAJOR FORCE IN TISSUE

Just seven years after moving into the tissue manufacturing market, Suzano’s Head of Global Pulp Sales, Marketing and Logistics Leonardo Grimaldi says the company is embarked on era-defining expansion. TWM Senior Editor Helen Morris spoke to him in São Paulo, Brazil.

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Merger and acquisitions, dramatic capacity expansions, fluctuating pulp prices … it’s an exciting time for the Latin American tissue market, which shows no signs of slowing down. Tissue projects that have started up in 2023 or will be in development during 2024 and 2025 include a tissue plant project in Argentina, one in Colombia, El Salvador, and Guatemala, three projects in Mexico, and – up until the end of 2025 –seven tissue projects in Brazil.

In the first quarter of 2026, following its R$650m investment in a new tissue paper mill in Espírito Santo, Brazil, vertically-integrated eucalyptus pulp and paper giant Suzano will put a further 60,000tpy of tissue capacity into the market.

Whether the Latin American tissue market will enter a state of overcapacity in the next few years – or just ‘extra capacity’ – remains to be seen. São Paulo-based Leonardo Grimaldi, who joined Suzano in 2000 and became the head of Global Pulp Sales, Marketing and Logistics in 2021, believes it will be an era-defining time – and a crucial period of capacity growth for the Brazilian tissue market.

As a world-leading producer of eucalyptus pulp, Suzano most recently made headlines when it acquired Kimberly-Clark’s Brazilian tissue business assets for $175m in 2022, after diversifying its product offering into tissue manufacturing in 2017. This boosted its Consumer Goods tissue manufacturing division to 280,000tpy, which at the time increased Suzano’s presence in the county’s tissue market from around 13% to 22-23%.

And following the start-up of TM10 in Espírito Santo, the company’s total tissue capacity will be 340,000tpy.

Speaking over a Teams call, in fluent English, Grimaldi – responsible for Suzano’s pulp business unit, selling to tissue producers globally – explains that the company’s consumer goods business unit has recently become the leader in value market share in Brazil. It is now ahead of Chileanheadquartered CMPC’s Softys Brasil’s 307,000tpy.

“Kimberly-Clark’s brands are the leading brands in Brazil, and there is such a premium to them that it takes us to a very important and relevant position in terms of value,” he says. “As a result, our current market share in Brazil is 23.7%. That is only in At-Home consumption, it doesn’t cover the AfH business, which in Brazil is small, say 15% of the market. The Brazilian market is roughly one million tonnes of toilet tissue, and napkins and kitchen towels, and roughly 200,000 tons of AfH.”

The increased tissue capacity in Espírito Santo will also mean Suzano can enhance its competitiveness in the most significant consumption region. The start-up of the tissue machine is expected for the first quarter of 2026. Investments are also being made at Suzano’s pulp mills – a further R$520m will be spent to replace a biomass boiler, and R$490m has been invested to expand the company’s fluff pulp production capabilities in São Paulo. “As a company, we are structured to ask how we can be more and more competitive, so that we are resilient to the ups and downs of the pricing cycle of the commodity. By design, we offer the best solution in terms of product and service and value to our customers who are non-integrated paper producers located globally.”

In 2021, Suzano also announced the Cerrado Project, the construction of a new pulp production plant in Ribas do Rio Pardo that will produce 2,550,000tpy of eucalyptus pulp. Scheduled to become operational by June of 2024, it will also be the first fossil-free pulp plant in the world.

“I run Suzano’s pulp business unit and we supply everyone, including our own consumer business unit, on the same terms. There is a huge virtual wall – on one side we are expanding tissue, through a separate and independent business unit, but it is my responsibility – as a leader of our market pulp division – to support all the tissue producers in Brazil, and help them stay competitive. It’s very interesting to understand that being verticallyintegrated does not undermine the possibility of being able to buy and sell market pulp across the board. Purchasing decisions depend a lot on logistics and this influences competitiveness, so having pulp mills in Brazil located close to our customers makes a huge difference.”

With Suzano’s extra 60,000tpy of tissue capacity also coming on stream and being sold domestically within Brazil, what will the company’s market strategy look like soon from the point of view of a pulp producer? “The strategy is based on value creation, but this is set independently by our consumer goods division. Across the region, there will be new tissue machines starting up in 2025 and my job is to sell them the pulp, at competitive prices and the right quality. Our new $2.8bn eucalyptus Cerrado Project is expected (...)

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