SUZ Materials · Pulp · Brazil · Exporter · Thesis updated July 20, 2026

Low-cost pulp, still hostage to pulp prices

Suzano is the world leader in eucalyptus pulp, with 14.5 million tons of annual installed capacity.
Cerrado lifted pulp sales volume 15% to 12.49 million tons in 2025, helping offset weaker prices.
Average pulp net price fell 16% to US$542 per ton in 2025, showing how exposed profits are to the cycle.
Paper revenue grew 25% to R$12.3 billion in 2025, helped by 19% volume growth.
The key question is whether Cerrado's lower cost can protect margins if pulp prices stay weak.

01 Running thesis

Scale helped, prices still ruled

The bull case starts with cost. Suzano grows eucalyptus in Brazil, where trees mature in about seven years. That gives the company cheap wood, huge scale, and one of the lowest pulp cost bases in the world.

Cerrado is the proof point to watch. The new Ribas do Rio Pardo mill added 2.55 million tons of annual pulp capacity after it was completed in July 2024. In 2025, Suzano's pulp sales volume rose 15% to 12.49 million tons, which helped keep pulp revenue nearly flat at R$37.8 billion even though average pulp price fell 16% to US$542 per ton.

The bear case is also clear. Pulp is a commodity, which means buyers care most about price and quality. If global supply keeps growing faster than demand, especially in China, Suzano can sell more tons and still earn less per ton.

The paper and tissue push gives Suzano another path. Paper revenue rose 25% to R$12.3 billion in 2025, with volume up 19%. That makes the company less dependent on raw pulp, but pulp is still the main profit swing factor.

Mar 2026→Suzano's 2025 Form 20-F showed a split picture. Cerrado volume kept pulp revenue roughly flat despite a 16% fall in average pulp price, while paper revenue rose 25%.

Apr 2025▲The 2024 Form 20-F confirmed that the Cerrado Project was completed in July 2024, adding 2.55 million tons of annual pulp capacity. Pulp net sales rose 22.5% in 2024.

Feb 2025▲Management said the Ribas mill finished its learning curve in six months and became Suzano's lowest cash-cost asset. The company also reported double-digit price increases on major U.S. packaging contracts.

02 Business model

Trees to ships to shelves

Suzano owns much of the chain. It plants eucalyptus, harvests wood, makes pulp, uses some pulp inside its own paper mills, and sells the rest as market pulp to paper producers around the world.

Most revenue still comes from market pulp. Customers are paper, packaging, tissue, and specialty paper makers that do not have enough pulp of their own. Suzano wins when its low wood cost and rail-to-port network let it sell at a profit while higher-cost mills struggle.

The downstream business is growing. Suzano sells printing and writing paper, paperboard, cupstock, liquid packaging board, tissue, and fluff pulp. The Neve toilet paper brand and other tissue assets move Suzano closer to consumers and can smooth some pulp price swings.

This model breaks when commodity prices fall too far, when shipping costs spike, or when forest supply is tight. The company must also spend heavily to maintain mills, forests, logistics, and environmental licenses.

03 Product portfolio

What Suzano sells

Cash cow

Eucalyptus market pulp

This is Suzano's main business. It sells short-fiber hardwood pulp to paper and tissue makers worldwide.

Steady

Printing and writing paper

Suzano is a major Brazilian producer of office and graphic paper. This is more domestic than the export pulp business.

Growth engine

Paperboard and packaging

Packaging demand is one of the stronger long-term paper markets. Suzano has been adding assets and contracts in this area.

Growth engine

Tissue and Neve

Suzano sells tissue products to consumers, including the Neve toilet paper brand in Brazil. This gives it more exposure to branded goods rather than only commodity pulp.

Option

Fluff pulp and Eucafluff

Fluff pulp is used in absorbent hygiene products. Suzano's Eucafluff line gives it a specialty product that may carry better margins than standard pulp.

Option

Liquid packaging board and cupstock

These products serve cartons, cups, and food-service packaging. They fit Suzano's move toward higher-value paper products.

04 Business segments

Pulp still dominates

Pulp75%flat

Paper25%growing fast

The mix uses Suzano's 2025 net sales from its Form 20-F: R$37.8 billion from pulp and R$12.3 billion from paper. Pulp is still about three quarters of these two reported segment sales, so commodity prices matter a lot.

05 Risk factors

What could go wrong

Pulp price slump

High impact · High odds

Suzano sold 15% more pulp volume in 2025, but its average pulp net price still fell 16% to US$542 per ton. That shows the main risk: more tons do not always mean better profits. If new global capacity runs ahead of demand, Cerrado's volume benefit could be eaten by lower prices.

We watchAverage realized pulp price in US dollars per ton and management's cash cost per ton after Cerrado reaches full run rate.

China demand shock

High impact · Medium odds

China is a major driver of global paper and pulp demand. If Chinese paper mills slow orders, Suzano's export-heavy model feels it quickly through lower pulp prices and weaker volumes. Trade disputes or tariffs could make that worse.

We watchChinese pulp import demand, paper mill operating rates, and Suzano's Asia sales commentary.

Forest and wood supply stress

Medium impact · Medium odds

Suzano depends on large eucalyptus plantations. Pests, disease, drought, fire, or poor age mix can raise wood costs or force expensive wood sourcing. The R$1.3 billion wood swap with Eldorado in 2025 shows that managing timber supply can require real capital.

We watchWood cost per ton, biological asset spending, forest productivity, and any new wood swap or land deal.

Debt and capital intensity

Medium impact · Medium odds

Large pulp mills and forests are expensive. Cerrado added 2.55 million tons of capacity, but projects of that size often need heavy debt and years of spending. Foreign exchange moves can also affect debt because part of the balance sheet is tied to the U.S. dollar.

We watchNet leverage, capital spending guidance, free cash flow, and the Brazilian real versus the U.S. dollar.

Environmental license pressure

Medium impact · Medium odds

Suzano is a major land and forest operator in Brazil. That brings scrutiny over land use, biodiversity, water, and native forest protection. The Biomas project, which aims to restore and protect four million hectares over 20 years, helps the license to operate but also shows the scale of the duty.

We watchEnvironmental fines, license delays, deforestation claims, and progress reports from Biomas.

06 Quick answers

In one breath

What does Suzano make?

Suzano makes eucalyptus pulp, paper, packaging materials, tissue, and fluff pulp. Its main product is market pulp, which other companies use to make paper, tissue, and packaging.

Why is Suzano considered a low-cost pulp producer?

Brazilian eucalyptus grows fast, with trees maturing in about seven years. Suzano also has huge scale, owned forests, mills near rail lines, and access to export ports, which help lower production and shipping costs.

What is the Cerrado Project?

Cerrado is Suzano's new pulp mill in Ribas do Rio Pardo, completed in July 2024. It added 2.55 million tons of annual eucalyptus pulp capacity and helped drive Suzano's 15% pulp volume growth in 2025.

What is the biggest risk for Suzano stock?

The biggest risk is pulp pricing. In 2025, Suzano sold more pulp, but average pulp net price fell 16%, which shows how quickly the cycle can hurt margins.