CMPC weighs USD 4.6bn Brazil pulp project against credit rating risk
CMPC is weighing whether to proceed with Projeto Natureza, a USD 4.6bn bleached eucalyptus kraft pulp mill in Brazil, amid reports that the debt required could cost it its investment grade credit rating. Analysts cited in the reports point to alternatives such as bringing in a joint-venture partner, divesting non-core assets or scaling back the plant's initial capacity to cut the upfront outlay. The reports, dated 6 October 2026, draw on Bloomberg.
Why this mattersA downgrade would raise CMPC's borrowing costs and limit access to bond funds, a trade-off other pulp producers weigh when sizing capacity expansions.
- Projeto Natureza is a planned USD 4.6bn pulp mill in Brazil producing bleached eucalyptus kraft pulp.
- CMPC holds investment grade credit status that it risks losing if leverage rises to fund the project.
- Rating agencies are reported to be monitoring CMPC's capital allocation strategy on the project.
- Analysts cited in the reports suggest alternatives including joint-venture partners, non-core asset divestments or a reduced initial plant capacity.
- Brazilian environmental licensing (IBAMA), currency volatility and pulp price cycles are cited as execution risks.