Suzano Raises Celulose Price by $20 per Ton for Asian Clients

Suzano, the world's largest producer of eucalyptus cellulose, is informing Asian clients of a $20 per tonne increase in cellulose price, effective immediately for August purchase orders. The company raised its investment projection for the year by 7% after reporting a Q2 net profit of R$5.01 billion, reversing a loss of R$3.77 billion in the same period last year.

Suzano S.A., the world's largest producer of eucalyptus cellulose, has announced a significant price increase for its Asian clients. Effective immediately for August purchase orders, the company will increase its cellulose price by $20 per tonne. This move comes after Suzano reported a strong Q2 net profit of R$5.01 billion, reversing a loss of R$3.77 billion from the same period last year. The company also raised its investment projection for the year by 7% [1].

The price increase is part of Suzano's strategy to maintain pricing power in a volatile market. The company's ability to produce pulp at a significantly lower cost than global peers has enabled it to sustain margins despite challenging market conditions. The price hike is expected to drive revenue growth and improve profitability, particularly in the face of potential trade tensions and raw material cost fluctuations [1].

Suzano's recent leadership transition, led by CEO João Alberto Fernandez de Abreu, has been instrumental in driving these strategic moves. Under his leadership, the company has prioritized capital discipline, cost optimization, and geographic diversification. The $1.7 billion acquisition of Kimberly-Clark's international tissue business exemplifies this strategy, as it reduces reliance on the cyclical pulp market while expanding into the more stable tissue segment [1].

The company's decision to increase prices for Asian clients is part of its broader pricing strategy. Suzano has executed strategic price increases in Europe and North America, aligning with market fundamentals while avoiding overexposure. The company's flexible pricing approach positions it to navigate price volatility without sacrificing long-term profitability [1].

Suzano's resilience in the face of market volatility has been a key factor in its success. The company's strong cash flow profile, liquidity position, and strategic diversification efforts make it well-positioned to outperform in a cyclical sector. For investors, Suzano's strategic clarity, pricing discipline, and diversification into tissue markets present a compelling case for long-term value creation [1].

References:
[1] https://www.ainvest.com/news/suzano-strategic-resilience-pulp-market-volatility-leadership-transition-pricing-power-catalysts-long-term-creation-2508/