A very successful market entry, good for us and good for Uruguay

Published 21 July 2015 by Alexandre Nicolini
In spite of the one year start-up delay of our new state-of-the-art pulp mill in Uruguay, Stora Enso BEKP “Perform Plus” has generated a lot of interest from our customers, ever since the mill started production in June 2014.
This interest, along with a very successful market entry strategy and product positioning allowed us to commercialize almost the entire production in record time. In fact, we wish to have had more capacity available in order to fulfil all our customers demand!
From a market perspective, the additional BEKP capacity that we brought in has been fully absorbed by the market with no impact whatsoever on prices, even if the general market consensus at the time of the start-up was that prices would come under heavy pressure due to the additional volumes entering the market.

Nevertheless and, against all odds, prices have actually remained stable during the 2nd half of 2014 (the year of the start-up) and, they are currently in an upward trend since Q1 and Q2 of 2015. Pulp demand has been healthy, it is true, but having established the right portfolio of customers in a more balanced way in all regions made the difference and, it has allowed us to position our new product on a very competitive level.

The feedback received from our customers are very encouraging, I must say, giving us extra energy to further boost sales and focus on selected customers. Also, it is important to emphasize that our customers are very pleased with the overall service level provided by Stora Enso, which is the result of very good and solid relationships established by the Sales team, the excellent Technical Support given, the highly efficient CSC and, last but not least, the reliable supply chain. Such a positive feedback means that our teams have worked hard and were able not only to read, but also to properly address our customers’ needs.
From an operational point of view, the mill has now produced over a million tons of pulp and its operational efficiency has already reached world class levels. Montes del Plata is now producing around 3,672 tons every day and, the production team is now working towards stabilizing the overall quality parameters, even though our pulp has been fully qualified by our customers.
In addition to being a great growth engine for Stora Enso, Montes del Plata also strongly contributes to Uruguay’s GDP growth, positively developing the whole country economically by creating direct and indirect employment.

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