Responsible Regional Leadership and Profitable Results Source: - - PowerPoint PPT Presentation

Emerging markets: Growing industries in Latin America 2019 (focused in the south pacific coast)

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Responsible Regional Leadership and Profitable Results

Source: Bracelpa, AFCP ,Barnet, SPC

Latin America the new reserve of sustainable energy of the world

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"With all the solar energy potential of

Chile, it could supply 60 times the consumption of the country and 20% of the world" 49% of the world's lithium reserves are in Chile, Bolivia and Argentina

Amazing Natural Resources

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Amazonas River, Galapagos island IguazúWater Falls, Pacific and Atlantic Oceans, The Patagonia & The Andes, Atacama desert

Amazing Natural Resources

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Amazonas River, Galapagos island IguazúWater Falls, Pacific and Atlantic Oceans, The Patagonia & The Andes, Atacama desert

Did you know that 4 out of the New 8 Wonders of the World are in South America ?

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Do you want to know why there is a growing market in Latin America?

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Latin America is first or one of the largest producer of wine, fruits, vegetables, fish, shrimps, sea food, pigs, beef, lambs, nuts, etc.

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Creative Resourceful Innovative Optimistic Practical Inclusive

The socio-political situation of Latin America

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PIB(GDP) PPP, LATAM 2019

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Source: Cepal

THE DISTRIBUTION OF THE POVERTY IN LATIN AMERICA

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Which are the richest countries in Latin America and its evolution

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Minimum wages in Latin America

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The world economy and our industry will be driving through difficult roads so we will need now more than ever:

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• STRONG LEADERSHIP
• RESPONSIBLE DECISIONS
• CAUTIOUS ACTIONS
• HARD WORK
• WORLD CLASS TECHNOLOGY
• INFRAESTRUCTURE,LOGISTIC ISSUES

Let’s carefully drive towards responsible and cautious decisions that can lead us to a healthy industry as it is in today’s Latin America

The containerboard industry has played a very important role in the development of Latin America’s fruits and seafood industry

15 L AT I N AM E R I C A I S F I R S T O R O N E O F T H E L AR G E S T P R O D U C E R O F :

• B AN A N A AN D O R G AN I C B AN A N A
• S AL M O N AN D T R O U T, T U N A F I S H , S R I M P S
• G R AP E S , AP P L E S , AV O C A D O S , C H E R RY, C R A N B E R R I E S ,

P O M E G R AN AT E S , F L O W E R S , V E G E TAB L E S AS AS PA R A G U S , A R T I C H O Q U E , P E P P E R , G AR L I C ,

• AL L K I N D S O T M E E T S AS C O W S , P I G S AN D L AM B S
• W I N E S

T H E P E N E T R AT I O N O F R E TA I L A N D L A R G E S U P E R M A R K E T C H A I N S , I N C R E A S E S T H E PA C K A G I N G C O N S U M P T I O N . I N T E R N E T S A L E S R E A C H E D $ 8 5 B I L L I O N U S D ( 2 0 1 9 ) , C O M P E T I N G W I T H T H E R E TA I L O R C O M P L E M E N T I N G .

The boxes for these products are fabricated in plants with a high

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IN SOME COUNTRIES HAVE TRANSPORT AND LOGISTIC PROBLEMS THAT DIFFER THE CONSTRUCTION OF WORLD CLASS PAPER MACHINES

THERE ARE VIEW LOGISTIC ISSUES THAT HAS TO BE RESOLVED

Latin American Market in Figures

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• World consumption containerboard

190 Mtonne,

• 2019. 150Mtonne recycled 40 Mtonne virgin
• Latin

America produces 5.8%

• f

the world’s containerboard and consumes 8%, it´s a net importer.

• Growth of Containerboard in Latin America from

2010 until 2016 , 3.2 % 2016-2018, YEARS 2018– 2022

World Containerboard Supply: Virgin and Recycled

 The overwhelming majority of the Containerboard Paper supply is from Recycled Paper  There has been Little to no growth in the supply of Virgin Containerboard paper  The majority of VirginContainerboard comes from the US  Most of Latin America’s paper imports come from the US

World Containerboard Industry

 Containerboard is the largest segment of the world paper & board demand  All forecasts point to a continued, strong, & healthy growth in the industry

LATIN AMERICA Participation and Growth

 Latin American participation in the global containerboard market is relatively low (8%)  However, it is one of the fastest growing markets

0% 1% 2% 3% 4% 5% 6% 7% Asia Western Europe Eastern Europe North America Latin America Africa Oceania All Others % GROWTH

Average Increase in Consumption 2010- 2016

Latin America at a Glance 2019

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Source: Cepal, IMF ,DbaseWEO

Brazil, 34% Mexico, 32% Argentina, 7% Chile, 4,5 % Colombia, 5% Ecuador, 6% Peru, 2% All Others, 9,5 %

CHILEAN WINE , SALMON ,TROUT,SEA FOODS, PIGS, LAMB FRUITS AND NUTS

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Chile is a 21.7% grape, global market and the biggest cranberry and cherry producer 5 out 100 fruit , that are consumed in USA are produced in Chile

CHILE IS THE FOURTH LARGEST EXPORTER OF APPLES IN THE WORLD

CHILE

23 Chile is a very vibrant and fast growing containerboard market. 60% of the market is for fruit boxes and 40% industrial. .Very strong market for Kraft Liner boxes. Due to the fruit, wine and salmon, pigs industries. Despite containerboard being produced locally by CMPC, there is a large quantity still imported from Canada, USA, Brazil and Europe. .

• A strong healthy high-tech containerboard industry with a respectable

and powerful leader.

• Five companies have updated their plants with new WORLD CLASS

corrugators.

• A new state-of-the-art WORLD CLASS paper mill

with a new production in 2008 of 300,000 Metric tons will reduce in 100,000 tonne

• f imported paper.
• A rebuilt newspaper machine to produce medium 100.000 tonne per

year in 2010

• Industrial boxes are made with low gramage paper. Between 450 &

500 gsm (grams per square meter = g/m²)

• The new kinds of fruits as berries and cherries use light weigth boxes

too, with sophisticated printing

Source: Barnet, SPC

CHILE

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• One strong respectable

company shares 45% of the Market.

• A total of 8 companies share

the remaining balance of 55%

• Chilean Market:

Industrial 50% Fruits, Salmon and Wine 50%

• Kraft Paper 30%, Recycled

Paper 60%, WTL 10%

• The Chilean Containerboard

Industry is a role model for all the Latin American countries

ECUADOR( THE COUNTRY OF OPPORTUNITIES) , ECUADORIAN BANANAS,SHRIMPS, SEA FOODS,TUNA FISH,FLOWERS, ORGANIC CACAO,COFFE,AVOCADOS, MANGOS

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ECUADOR

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• The fourth largest

consumption in corrugated paper in Latin America.

• A country that makes

more than 338 million banana boxes per year.(2019)

• Ecuador is the largest

Kraft Liner importer in all

• f South America.
• Due to the large fruit

industry, Ecuador is a large consumer of White- Top

• Population: 16.5 million
• Area: 272, 045 sq km
• Major language: Spanish
• Currency: USD
• GDP: 194 billion.

ECUADOR

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Ecuador

 Is the second largest tuna and shrimp, exporter in the

world



ships more than 5 million tonnes of bananas a year, to put it into perspective: Colombia, Costa Rica, Honduras, and Guatemala each one ship around 1 million tons, provides 30% of the world’s banana supply.

 Ecuador is the third world exporter of flowers with 7% of

the international market

Ecuador

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• 3 integrated strong respectable

companies shares 75% of the Market.

• A total of 1 non integrated

company share the remaining balance of 25% Expansion:2010 up

• - Surpapelcorp 120 k

Future expansion 70k 2020

• SPC is a strong new incomer in

the paper industry and leadership in the containerboard industry.

• Banana Boxes 70%, Industrial

Market 20% and Fruits & Sea Food 10%

PERU AN EMERGING FRUIT COUNTRY ,GRAPES, MANGO,ORGANIC BANANA,AVOCADOS,CRANBERRIES,ASPARAGUS, FRUITS AND VEGETABLES

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PERU

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• A strong healthy containerboard industry with a respectable and

powerful leader.

• Five companies have updated their plants with new corrugators.
• There are not a new state-of-the-art paper mill
• Industrial boxes are made with low grammage paper, between

500 gsm to 650 (grams per square meter = g/m²)

Source: Barnet, SPC

• Peru is the fastest growing containerboard market in Latin
• America. In the past 3 years the growth of containerboard has

been in close to 9%, today close to 6 %

• 50% of the market is for fruit boxes and 50% industrial.
• As is common in Latam except Brazil and Chile Peru have a lot of

Small and old paper machines, for corrugated board production, there not are any world class paper machine

• Big corrugated boxes companies with small corrugated plant with
• ut of the actual standards trim
• Perú is a member a APEC,

agree a Free-Trade deal with both Canada and the U.S. and Euro community

Peru

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• Expansion:
• -Trupal S.A. 30K
• One company has the

leadership with 60% of the market.

• Industrial Market 65%,

Fruits & Sea Food 35%

• Highly Integrated

Companies

COLOMBIA

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• A strong healthy containerboard industry with a respectable and

powerful leader.

• Five companies have updated their plants with new corrugators.
• There are not a new state-of-the-art paper mill
• Industrial boxes are made with low grammage paper, between 450

& 500 gsm (grams per square meter = g/m²)

Source: Barnet, SPC

• Is a very strong containerboard market that has great opportunity.
• The market has been growing at an annual rate of 6%.
• 40% of the market is for fruit and flower boxes and 60% industrial.
• As is common in Latam except Brazil and Chile, Colombia have a

lot of Small and old paper machines, for corrugated board production, there not are any world class paper machine

• Big corrugated boxes companies with a lot of small corrugated

plant with out of the actual standards trim

• Colombia is a member a APEC,

agree a Free-Trade deal with both Canada and the U.S. and Euro community

COLOMBIA A FRUIT EXPORTER COUNTRY ,FLOWERS, MANGO,PINNEAPLE, BANANA,AVOCADOS, FRUITS AND VEGETABLES

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Colombia is the second largest flower exporter in the world

Colombia

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• One strong respectable

company shares 55% of the Market.

• A total of 6 companies

share the remaining balance

• f 45%
• Colombian Market:

Industrial 70% , bananas 20% and 10% flowers

• Highly integrated industry

CONCLUSIONS

Latin America – A New Era

• f Sustained & Inclusive, fruit food market

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Opening Comments

 Corrugated packaging remains the packaging of choice in

Latin America and World – Wide.

 Great value for the money.  It’s reusable, recyclable, renewable and sustainable and inclusivity.  It has competitive advantages over plastic containers.  The packaging industry has a strong value proposition for clients.

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What Does This All Mean For Latin America

 Latin America has advantages over other regions:

Latin America's growth is very dependent on external financing

Existing trade agreement with APEC,EUROPEAN COMMUNITY, US, is already significant. Near proximity to the US-shorter shipping times. Relatively low labor rates. Low fiber prices for mills. Already a major exporter of fruit, sea food, meat, wine, vegetables, beverages and light industrial products to the US.  2019 Corrugated shipments expected to be better than

2018: + 0.5% growth.

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Latin America Affected by Economy in the Apec, Europe and US, mainly to difficult trade agreement US,CHINA

 Latin America’s industrial sector is extraordinary selling to U.S. is

impacted: housing, light industrial consumer.

 Food, beverage and agriculture are strongest segments.  Latin America’s corrugated packaging industry has done well despite

global economic slowdown.

 The internal market in Latin America is growing with de retail

penetration and de e-commerce.

 Light industrial/consumer oriented affected the most.  Slow economic growth and difficult credit availability characterize

near term market conditions.

 Lower growth compared to previous years .  Despite challenges corrugated volume in Latin America grew an

estimated 2.7% incl..

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Situation of the paper and corrugated industry

 The paper industry is in a concentration and vertical

integration process

 In this process of concentration of the industry, old, slow

and narrow paper machines have remained in operation, the same in corrugated plants.

 The only world class papers machine are in Brazil , Chile,

and Ecuador.

 However, in the corrugated board box industry there are

in many countries with world class machines



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