Suzano says it is not yet ready to merge its own consumer-goods operations with Arbex, the tissue joint venture it formed with Kimberly-Clark covering 22 plants in 14 countries. Executive vice-president Pablo Machado said a merger could be considered once Suzano judges its own tissue business has matured and Arbex has captured its planned efficiency gains. The group is targeting USD 175m in operational efficiency at Arbex over three years.
Why this mattersA future combination would consolidate Suzano's downstream tissue footprint with Kimberly-Clark's international hygiene assets, deepening its shift beyond pulp.
- Arbex, the Suzano-Kimberly-Clark joint venture, comprises 22 industrial units across 14 countries making and selling hygiene paper products.
- Suzano is targeting USD 175m in operational efficiency gains at Arbex over three years, a goal stated earlier in 2026 by CEO Beto Abreu.
- Suzano acquired Kimberly-Clark's Brazilian tissue operations in 2023, including the Neve brand and the Mogi das Cruzes mill with 130,000 tonnes a year of semi-finished paper capacity.
- Suzano says it cut costs at the Mogi das Cruzes plant by around 40% within six months of taking it over.
- Executive vice-president Pablo Machado said Suzano does not currently see merit in combining operations, citing unrealised gains still to be captured at Arbex.
- Suzano said on 21 October 2026 it will report Consumer Goods as a segment separate from Pulp & Paper from Q3 2026 onward
- The change follows the creation of Arbex and introduces a new methodology allocating pulp costs consumed by the Consumer Goods unit
- Historical data from Q1 2025 to Q2 2026 will be restated pro forma, with no impact on previously reported consolidated results
- Suzano is changing the methodology for costing pulp consumed by the Consumer Goods unit
- Suzano will restate pro-forma quarterly segment data from Q1 2025 to Q2 2026 to preserve comparability
- Suzano says the segment-reporting changes do not alter previously reported consolidated results
The Greater Augusta Utility District has sued Sappi North America, Huhtamaki, Kimberly-Clark and two American Tissue entities in federal court, alleging PFAS discharges from their paper and packaging plants contaminated groundwater feeding its drinking-water wells. The district, which serves about 13,750 residents, says PFAS first appeared in its wells in October 2021 and exceeded Maine's drinking-water standard by November 2024. Huhtamaki is accused of discharging PFAS-containing wastewater to a sanitary treatment district in Waterville; Sappi says it complies with environmental permits and does not knowingly use PFAS materials.
Why this mattersThe suit tests whether paper and packaging producers can be held liable for PFAS reaching shared municipal water supplies, beyond contamination at their own sites.
- Defendants named: Sappi North America, Huhtamaki, Kimberly-Clark, American Tissue Mills of Maine and American Tissue Corp.
- The Greater Augusta Utility District supplies drinking water to about 13,750 residents in Maine.
- PFAS were first detected in the district's wells in October 2021; levels exceeded Maine's drinking-water standard by November 2024.
- The district took a well offline and installed treatment in response to the contamination.
- The lawsuit alleges Huhtamaki discharged PFAS-containing wastewater to the Kennebec Sanitary Treatment District in Waterville.
- Sappi says it complies with environmental regulations and does not knowingly use PFAS-containing materials.
- The utility is seeking a jury trial and recovery of past and future PFAS remediation costs
- The complaint includes claims of negligence and continuing public nuisance
- Lawsuit filed 7 October 2026, case No. 1:26-cv-00512, in the US District Court for the District of Maine
- District's Riverside wells showed PFAS at about 23.3 ppt in November 2024, above Maine's 20 ppt interim standard
- District spent about USD 2m, largely grant-funded, on an ion-exchange treatment facility operating since summer 2026
- Claims include CERCLA cost recovery, public and private nuisance, trespass and negligence, with a jury trial requested
- A November 2024 well sample showed combined PFAS concentration of 23.3 ppt, above Maine's 20 ppt limit
- Treatment equipment costing approximately USD 2m was installed after affected wells were removed from service
- A September 2026 sample showed no detectable PFAS and the supply was returned to service
- Sappi and Huhtamaki said they would defend their positions in the suit filed 7 October 2026
- The lawsuit was filed on 7 October 2026 in federal court.
- A November 2024 test found PFAS at approximately 23.3 parts per trillion in the district's water.
- The district's grant-funded filtration system, completed in 2026, cost approximately USD 2m.
- The suit invokes the federal Superfund law (CERCLA) to recover cleanup costs.
Suzano is attempting a further pulp price increase in October, targeting USD 600 per tonne for short-fibre pulp in China, after successfully pushing through a rise in September, according to a BTG Pactual note following meetings with Suzano executives in New York. The bank cites lower port inventories, delays to Asia Pulp and Paper's OKI II project and about 1.3 million tonnes of permanent long-fibre capacity closures as supporting near-term prices, but Suzano itself warned that new supply due in 2027, including Arauco's 3.5 million tonne Sucuriu plant and the delayed 1.4 million tonne OKI II project, could outpace demand growth of only 1-1.5 million tonnes a year and push prices lower again. Suzano said it is prioritising debt reduction and integration of its Kimberly-Clark joint venture over new capacity investment, expecting leverage to peak in the third quarter of 2026.
Why this mattersBuyers face higher pulp costs now, while 2027 capacity additions far exceed structural demand growth of 1-1.5m tonnes a year.
- Suzano is targeting USD 600 per tonne for short-fibre pulp in China in the October price round, after implementing a September rise, per BTG Pactual.
- Arauco's Sucuriu plant in Mato Grosso do Sul is expected to start in H2 2027 with capacity of 3.5 million tonnes of pulp a year.
- Asia Pulp and Paper's OKI II project, delayed to 2027, is expected to add a further 1.4 million tonnes of capacity.
- About 1.3 million tonnes of long-fibre pulp capacity have been permanently closed, supporting the recent price recovery.
- Structural pulp demand growth is estimated at only 1-1.5 million tonnes a year, below planned new supply.
- Suzano expects its leverage to peak in the third quarter of 2026 after completing its Kimberly-Clark transaction, and is prioritising debt reduction over new capacity.
- Hardwood pulp price increase of USD 50 per tonne in the Americas and Europe and USD 20 per tonne in Asia, effective 24 September 2026
- Net debt target lowered to USD 11bn from USD 12bn as of 22 September 2026
- 2026 capital expenditure plan set at USD 2.1bn
- Q2 2026 revenue of BRL 11.59bn and net income of BRL 1.81bn, with adjusted EBITDA of BRL 4.2bn at a 48% margin on pulp sales of 2.9m tonnes
Suzano has tightened its deleveraging target to USD 11bn net debt and leverage below 2.5x net debt/EBITDA, from a previous USD 12bn goal, after ending the second quarter of 2026 with net debt of USD 12.8bn and leverage of 3.4x. The pulp producer will cut 2026 capital expenditure to USD 2.1bn (BRL 10.9bn), about 18% below 2025, pay only the minimum mandatory dividend, be more selective on buybacks and review sales of non-core assets. The targets were set out in a presentation for the J. Safra Investment Conference on 22 September 2026.
Why this mattersA tighter debt target and capex cut at a top global pulp producer signals caution as new Latin American and Chinese capacity threatens pulp prices and margins.
- Net debt target tightened to USD 11bn and leverage to below 2.5x net debt/EBITDA, from a previous USD 12bn goal.
- Net debt was USD 12.8bn and leverage 3.4x at the end of the second quarter of 2026.
- 2026 capital expenditure is projected at USD 2.1bn (BRL 10.9bn), about 18% below the USD 2.6bn (BRL 13.3bn) spent in 2025.
- Of the 2026 capex, USD 1.4bn (BRL 7.3bn) is for maintenance of existing operations.
- While deleveraging, Suzano will pay only the minimum mandatory dividend and be more selective on share buybacks.
- Revenue for the 12 months to June 2026 was about USD 9bn with adjusted EBITDA of USD 3.8bn, a 42% margin.
The European Commission has unconditionally approved the USD 3.4bn tissue and personal care joint venture between Suzano and Kimberly-Clark, covering international operations including the Kleenex brand. Suzano will hold 51% of the combined international tissue business. The deal, announced in June 2025, still awaits clearance from the UK competition authority.
Why this mattersClearance removes a major regulatory hurdle for one of the tissue sector's largest consolidation deals as producers seek scale amid overcapacity.
- European Commission approved the joint venture unconditionally on 21 September 2026
- Deal value stated at USD 3.4bn
- Suzano will hold 51% of the combined international tissue business, including Kleenex
- Transaction was first announced in June 2025
- UK Competition and Markets Authority review is still pending
The US House Energy and Commerce Committee voted 28 to 19 on 16 September 2026 to send H.R. 7502 to the House floor, a bill that would count advanced recycling as recycling and set a national standard for recycled-content labelling claims, overriding state rules. The American Forest & Paper Association opposes the bill. Conservative group Consumer Action for a Strong Economy has written to International Paper, Pratt Industries, Kimberly-Clark, Packaging Corporation of America, Smurfit Westrock and Procter & Gamble, all of which have executives on the AF&PA board, asking them to make the association drop its opposition or reconsider membership.
Why this mattersFederal rules on recycled-content claims would set one standard across the states and expose the split between paper and plastics recycling interests.
- The House Energy and Commerce Committee voted 28 to 19 on 16 September 2026 to advance H.R. 7502, sponsored by Republican New York Rep. Nick Langworthy.
- The bill would set a national standard for when a product can be labelled as made with recycled material and would override state rules on those claims.
- AF&PA opposes the bill, spokesperson Lindsay Murphy told Politico; the association says recycled-content claims should reflect the material actually in the product.
- Consumer Action for a Strong Economy sent September letters to International Paper, Pratt Industries, Kimberly-Clark, Packaging Corporation of America, Smurfit Westrock and Procter & Gamble.
- The letters ask each company to make AF&PA stop opposing advanced recycling legislation or reconsider its board membership.
- Texas Rep. Marc Veasey was the only Democrat to vote for the bill, and no Senate version has been introduced.
