Ergilio Claudio-da-Silva Jr Ergilio Claudio-da-Silva Jr So Paulo, - - PowerPoint PPT Presentation
Ergilio Claudio-da-Silva Jr Ergilio Claudio-da-Silva Jr So Paulo, Brazil So Paulo, Brazil Corporate Technology Manager, Corporate Technology Manager, Aracruz Celulose SA Aracruz Celulose SA Opportunities and Threats to Opportunities and
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The Marcus Wallenberg Prize Symposium Stockholm, November 14th, 2007
Ergilio Claudio-da-Silva, Jr. Aracruz Celulose S. A. - Brazil
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Eucalyptus flowers
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– in the South
us
characteristics '
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WHERE'S THE ACTION? TODAY'S NUMBERS AND TRENDS...
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BHKP Production and Delivery Costs
CIF West Europe, Q2 2 0 0 7
Source: Hawkins Wright
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Total Volum e: 1 1 m illion tons Total Volum e: 2 2 m illion tons
Hardwood Demand - 1990
NBHK 44% SBHK 22% Euca 32% Other ( Tropical) 2%
South: 3 4 % South: 6 3 %
Hardwood Demand - 2006
NBHK 28% SBHK 9% Euca 50% Other ( Tropical) 13%
Source: PPPC * Numbers based on demand
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1 China 45 2 3 4 5 6 7 8 India 32 All Planted Forests in the South 20 Russia 17 USA 16 Japan 10 Canada 6 Brazil 5,7 Chile 2 1 USA 52.926 2 Canada China Finland Sweden Brazil Japan Russia 9 Indonesia 5.468 10 India 3.351 25.397 3 16.310 4 12.619 5 12.103 6 11.100 7 10.839 8 7.460 1 USA 82.628 2 China Japan Germany Canada Finland Sweden South Korea 9 France 10331 10 Italy 9.998 11 Brazil 8.750 56.000 3 30.951 4 21.679 5 19.499 6 12391 7 11.737 8 10548 P&B 2 0 0 6
In thousand tonnes
Pulp – 2 0 0 6
In thousand tonnes
Plantation Forests - 2 0 0 6
total area, million ha Sources: FAO, Bracelpa / PPI
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with our raw materials, our processes, our actions
and cost reduction are everyday concerns – clever definition of technology of production units
management, product differentiation, services, knowledge management (human knowledge doubling
every 9 months – in Bioenergy , every 3 months !)
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It is cheaper to produce in Southern Hemisphere
planted forest productivity gains ( genetics + forest management ) in the last 35 years - from 20 to 40-50 m³/ha/year
Low costs and fiber quality - key factors for competitiveness
fiber uses
Capital costs
producers, the region still displays a significant structural advantage
requires experienced, competent human resources
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THEN, WHAT ? HOW DID WE GET HERE ?
WHAT ARE THE MAJOR ACHIEVEMENTS AND LEARNINGS, SO FAR ... THAT WE SHOULD PURSUE, TOWARDS THE FUTURE ?
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Quality / / Product Differentiation Product Differentiation
Productivity / / sustainability sustainability
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Period before Aracruz
Post Aracruz
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General General aspect aspect of
the first planted forests established by Aracruz
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Canker disease
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Clonal propagation at commercial scale
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... 24 months !!! ... 24 months !!!
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productions
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Long term commercial relationships with key players Target on high value added and consumer end products High quality, homogeneous pulp .... technology Product development ... technology High quality service
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6.4 8.1 10.2 11.3 5 7 9 11 13
adt/ha/year
70's 80's 90's 00's Decade
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FOREST FOREST PULP MIL PULP MILL PRODUCT PRODUCT CLIENTS LIENTS Productivity/Sustainability Logistics Mechanization Operational Efficiency Production flexibility Quality demands Pulp Uniformity Differentiated products Added value
quality
INNOVATION AND TECHNOLOGY
Aracruz proposition is to generate a superior return for its shareholders, while promoting the efficient use of renewable planted forests, to meet the demands of the global pulp and paper and solid wood products markets, and other uses.
OPERATIONAL EFFICIENCY : máximum sustainable production, at lowest cost
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Advanced generations x sustainable gains …
10 months 18 months
Tropical x Temperate hybrids
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Genetic transformation of elite clones Only lab and greenhouse research Outsourced genes: wood quality and productivity Important partnerships
Legal and emotional challenges
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Biodiesel
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Agroforestry Systems in Brazil
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Opacity S
t n e s s S m
h n e s s Bulk/ Stiffness
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6.4 8.1 10.2 11.3 5 7 9 11 13 adt/ha/year 70 80 90 00 Decade 15 10 Now projected … 13.5
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and there are many more success stories, and more yet to come, mostly developed in the South, and strongly based on :
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(" depends on ability to understand and respond to increasingly intense demands from society ")
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From market 'trend setters' around the world - EU's FP7, A 2020
Advance the wood products revolution – next generation fibers and
their utilization
Faster changes in consumers demands – innovative products at a
faster pace
New, resource-efficient manufacturing processes Availability and use of forests for products and energy production Sustainable development and management of forests, used for
multifunctional demands
Value-generating businesses in a societal perspective
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From market 'trend setters' around the world - EU's FP7, A 2020
Advance the wood products revolution – next generation fibers and
their utilization
Faster changes in consumers demands – innovative products at a
faster pace
New, resource-efficient manufacturing processes Availability and use of forests for products and energy production Sustainable development and management of forests, used for
multifunctional demands
Value-generating businesses in a societal perspective
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demands
land availability – costs and disputes ( for other uses ) water availabilty and use forest, processes and product certifications, S-Ox carbon footprint reduction
capital related – accessibility, taxes, exchange rates... more stringent environmental controls more taxes ( e.g. water usage ) land costs energy and logistics infrastructure
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demands
land availability – costs and disputes ( for other uses ) water availabilty and use forest, processes and product certifications, S-Ox carbon footprint reduction
capital related – accessibility, taxes, exchange rates... more stringent environmental controls more taxes ( e.g. water usage ) land costs energy and logistics infrastructure
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Opportunities
Stress tolerant materials (genetics/biotech) Enhanced state of alertness/innovative monitoring
clones(biotech)/Agroforestry syst/tree farm programs
syst/tree farm programs
efficient processes
Threats
Productivity Pests and Diseases
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Threats
Productivity Pests and Diseases
Opportunities
Stress tolerant materials (genetics/biotech) Enhanced state of alertness/innovative monitoring
clones(biotech)/Agroforestry syst/tree farm programs
syst/tree farm programs
efficient processes
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the north – Pulp prices improvement
Brazilian companies as "investment grade"
>Big mils with scale and state
units, with alternative cash generation options and higher profitability.
higher taxes
less availability and use for energy production
industries consolidation. More expensive freights and capital investments.
systems and more expensive production lines (water, energy, env. control vs better products)
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taxes
availability and use for energy production
industries consolidation. More expensive freights and capital investments.
systems and more expensive production lines (water, energy,
north – Pulp prices improvement
companies as "investment grade"
mils with scale and state of art technology.
with alternative cash generation
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Threats
( wood, energy, water, logistics related)
expensive operations)
Opportunities
(intensive use of Biotech-derived matls)
manufacturing/stress tolerant clones
agroforestry/tree farm programs
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Threats
( wood, energy, water, logistics related)
expensive operations)
Opportunities
(intensive use of Biotech-derived matls)
manufacturing/stress tolerant clones
agroforestry/tree farm programs
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Wood
(Pulping)
Pulping
Market Pulp Market Market Pulp Pulp
Hemicelluloses
Wood
(Reject/lefts)
Chem/enzymes Hydrolisis
Alcohol
Cellulose and Hemis
Black Liquor Black Liquor VPP VPP Forest Mill
Pyrolysis/Gasiification
Alcohol/other fuels
Any kind of carbon from biomass
Crops Crops
Biodiesel/Ethanol
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Pinhão Manso
Jathopha curcas
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The Forest Forest Products Products I ndustry I ndustry in in the the South South has has experienced experienced a a significant significant grow th grow th in in the the last last 4 0 4 0 years years – – w hile doing its hom ew ork... w hile doing its hom ew ork...
Present resent and and future future trends trends and and dem ands dem ands from from business business and and society society define define significant significant threats threats/ / challenges challenges and and opportunities
to this this industry industry. .
I t is expected expected that that the the Forest Forest Products Products I ndustry I ndustry in in the the South South continues to be continues to be w ell w ell fit fit and and com petent com petent to to m aintain m aintain its its successful successful path path tow ards tow ards the the future future. .
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Two-thirds of the growth in market BHKP will be Eucalyptus pulp. Demand for Acacia pulp is also expected to grow, while demand for mixed tropical hardwood pulp will decline.
5 10 15 20 25 30 35 40 1980 1985 1990 1995 2000 2005 Million tons Forecast Mixed tropical Mixed northern Acacia Euca Birch Mixed southern
Sources: Poyry and Aracruz
2010 2015 2020
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1980 – 6.7 million tons 2006 – 23 million tons
38% North 62% South 68% North 32% South
2015 – 31.4 million tons 2020 – 35.1 million tons
68% South 32% North 70% South 30% North Sources: Poyry & Aracruz
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A typical tree-farm property in Brazil