"In 2025, hardwood pulp gained yet another percentage point of the market share over softwood, creating an additional demand of 700,000 tonnes for hardwood pulp." – Leonardo Grimaldi.
By Leonardo Grimaldi, Executive Vice President of Commercial and Pulp Logistics, Suzano.
We are currently seeing a structural shift in the pulp and paper sector, driven by innovations in technology and production methods, that will result in considerable benefits for the industry and the planet. Manufacturers are now increasingly able to substitute softwood fibers with hardwood alternatives, which can result in substantial cost savings and reduced environmental impact. This has been an ongoing trend for some time and last year was no exception. In 2025, hardwood pulp gained yet another percentage point of the market share over softwood, creating an additional demand of 700,000 tonnes for hardwood pulp.
We expect this growth in demand to continue. Forecasts suggest that by 2029, the total volume of global hardwood pulp production will reach approximately 49 million tonnes, up from around 41 million in 2024. Of this increase, over half will be from an organic increase in demand driven by activities in China and other Asian markets. But our conservative estimate is that a very significant proportion of the total growth, around 3 million tonnes, will come from the impact of new fiber solutions increasing demand for hardwood substitution.
However, the positive demand side dynamics are being impacted by upstream verticalization in Asia. As the overall demand for hardwood pulp in the region has risen, some paper producers in China and other Asian countries have been investing in their own pulp production (hardwood, BCTMP and other grades) and supply (full or partial) capabilities. This shift has reduced the addressable market for paper grade pulp, affecting Supply and Demand dynamics and causing prices to trend below historical values.
Market consultancies estimate that, currently, around 14 million tons of pulp being produced - both hardwood and softwood is losing money, as market prices have fallen below their cash costs. In this scenario, it is probable that permanent closures, commercial related downtimes and asset redesigns to accommodate alternative products could accelerate, consequently rebalancing market dynamics.
Against this backdrop, Suzano's strategic focus this year is on two priorities: continuing to enhance our cost leadership and competitiveness across every vertical of our business, and expanding the addressable market for hardwood pulp, strengthening our partnership with our global customer base. We remain committed to being the market leader in new fiber solutions and expanding the hardwood share across all segments, where we still see a low base for hardwood usage and significant room to grow. Through technical partnerships, a distinctive portfolio of client services, innovation programs and the development of enhanced eucalyptus grades that are closing in on the technical properties of softwood, we are helping more and more of our customers unlock greater efficiency and sustainability. We supported more than 170 partners implement new fiber solutions in 2025, compared to fewer than 100 in the year prior. And our investments in fluff pulp further diversify growth opportunities in hygiene markets.
As 2026 gathers pace, Suzano's scale, innovation, and customer-centric approach position the business well to capitalize on these trends and shape a more competitive, bio-based future for the pulp and paper industry.
Suzano is the largest hardwood pulp producer in the world, operating eight pulp mills in Brazil with a combined production capacity of 13.5 million tons per year of pulp. Based in Brazil, the company also produces paper and tissue.
SOURCE: Hawthorn Advisors for Suzano