CMPC has signed a deal with Brazil's southernmost state of Rio Grande do Sul to evaluate building a new, $4 billion pulp plant there, the Chilean pulpmaker said on Monday.
The new project, which would be in the city of Barra do Ribeiro, would initially have the capacity to produce up to 2.5 million metric tons of bleached hardwood kraft pulp (BHKP) per year, CMPC said in a securities filing, adding that it could later be expanded.
The firm said the project would undergo technical and environmental studies before being presented to the CMPC board for vote in mid-2026.
CMPC, which also has paper and biopackaging businesses, produced a total of about 4 million tons of pulp in 2023.
In Brazil, it currently has the capacity to produce some 2.5 million tons of pulp through its plant in Guaiba, a city also located in Rio Grande do Sul, according to the company.
Beyond the investment required for the plant itself, the new project would also need $420 million for roads and infrastructure near the potential factory and $150 million to expand a port terminal and build another in the city of Rio Grande.
The company would later receive tax compensation due to some of the investments in infrastructure, Ernani Polo, Rio Grande do Sul's secretary of economic development told journalists.
CMPC did not give details on when the potential factory could start to operate.
(Reuters - Reporting by Andre Romani; Editing by Kylie Madry, Brendan O'Boyle and Michael Erman)