Klabin moves ahead with investments in packaging paper and pulp; sets new sack kraft PM startup for October

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Klabin moves ahead with investments in packaging paper and pulp; sets new sack kraft PM startup for October

July 31, 2013 - 03:28

SAO PAULO, July 31, 2013 (RISI) -Klabin's investments totaled Real 194 million in the second quarter of 2013, Real 69 million of which were directed to mill operations and Real 107 million destined to the expansion of the sack kraft and recycled papermaking capacity. According to the company's CFO and investor relations officer, Antônio Sérgio Alfano, the new 80,000 tonnes/yr sack kraft machine in the Correia Pinto mill, in Santa Catarina state, is expected to start up next October, and all of the construction works required have been completed.

The installation of the recycled paper machine in the Goiana unit, in Pernambuco state, is also advancing as expected, with infrastructure arrangements and construction works already under way. Startup remains scheduled for the beginning of the second half of 2014.

As for the expected new boxboard PM, Klabin's CEO Fabio Schvartsman commented that the project is still being studied and details are being ironed out for increasing production and tapping into an array of potential sales. "Nowadays we could sell much more boxboard if we had the production capacity necessary for doing so. We're at this time negotiating long term supply contracts with our clients," he said, also pointing out the future debottlenecking of the PM #9, which is expected to have its capacity increased by 40,000-50,000 tonnes/yr.

Regarding the Puma project, which involves the construction of a new 1.5 million tonnes/yr pulp plant in the city of Ortigueira, Paraná state, Schvartsman dismissed the rumors of a possible change in the original plans of raising funds through a capital increase. "We remain completely focused on the capital increase. Surely we won't perform this operation at conditions that are not favorable to the company and its shareholders. Evidently this is a long process that we always knew was never going to be executed before the second semester," he stated.

The CEO recognizes that alternatives to the capital increase do exist, but the original idea remains being pursued with optimism. Any possible changes in the conditions of such increase were also dismissed. "The terms were carefully elaborated by Klabin and explained to the market. At our end, there's no possible change. If there were, it would already have been made at this time," he said.