Suzano upbeat about growth potential in Chinese market

Brazil-based world's leading pulp producer Suzano is confident about the growth prospects of the Chinese market and has introduced a trial trade of its products in renminbi in order to strike deep roots in the country, the company's global CEO told China Daily.

"Our confidence is that China is preparing even more for the future," said Walter Schalka, CEO of Suzano. "We already made a trial to trade our product in renminbi, as we strive to be more localized to serve our customers here."

Schalka said he sees a good correlation between the company's business and China's GDP growth. The Chinese economy grew 5.2 percent year-on-year last year and has set a target to grow 5 percent this year.

"Together with the steady economic growth, the company's pulp business grew 6.6 percent last year in the Chinese market," he said.

"China now represents roughly 40 percent of our total exports. Suzano is exporting to over 100 different countries around the globe, but China is by far the most relevant market for us," Schalka said, adding that this percentage is "steadily growing "every year.

Schalka disclosed that the company had already gained some orders at the beginning of this year and is confident that the order book will keep growing.

He made the remarks as the Brazilian company celebrated its 100th anniversary with Chinese stakeholders in Shanghai late last month. During the celebration, the company reinforced its commitment to further expanding in the Chinese market, and called on its local stakeholders to work together to shape the future.

Schalka said: "The Chinese market is very dynamic and has been growing, but we see even more potential for growth for the coming years."

"The per capita consumption in the tissue business in China has been growing steadily. It's still below certain Western regions such as Europe and the United States. There is an opportunity for us, as we are seeing higher GDP growth opportunity to keep enhancing and increasing per capita consumption," he said.

In March, Suzano signed two strategic partnership frameworks, one with the China-UK Low Carbon College of Shanghai Jiao Tong University, and the other with its business partners. This constitutes an important part of Suzano's new global initiative of investing $100 million in the coming years to strengthen innovation and sustainability practices across all regions.

"Innovation is part of our DNA," Schalka said. "We set our innovation hub in Shanghai last year and the idea is to work not only with our customers to enhance their competitiveness, but to look for alternatives to use biomaterials for the future as well."

Schalka believes such innovative efforts are in line with the country's focus on developing new quality productive forces.

"It appears to me as a shift toward innovation-driven growth, with a focus on advanced productivity that moves away from traditional economic models. Strategic emerging industries and industries of the future are seen as key drivers of the new quality productive forces," he said.

"These industries include biotechnology, new energies, new materials and environmental protection, all industries that will contribute not only to growth, but to ensure high-quality growth and healthy development of society in harmony with nature," he added.

In the long run, China's ongoing new round of technology revolution and industrial transformation, in response to its transition from high-speed to high-quality growth, is expected to unleash its inherent growth potential and inject new impetus into the high-quality development of the Chinese economy, he said.

"Companies aligned with the new quality productive forces and promoting high-quality development, such as Suzano, will continue to thrive in China," he added.