Rio Grande do Sul

Outlook

(102-2, 102-7.v and 102-15)

8,330 hectares of Pinus eliotti plantationmanaged for the supply of gum resin at the Resin plant in RS andcommercialization of wood.

Our 12 properties are concentrated in Balneário Pinhal, Cidreira, Mostardas, Tavares and São José do Norte.

Our management system comprises a cycle of 21 years.

First company in the Resin segment to have the forest management and chain of custody certified by FSC® (FSC-C120229/FSC-C116791). We also have ISO 9001:2015 and ISO 14064:2006 certifications.

• We are the first company to produce pitch and turpentine in Brazil. Resination is a way of anticipating a forest’s revenues, generating direct jobs and contributing to convincing people to remain and work in agricultural regions.

Results of the year

(102-15 and 304-2)

Planting:

1,121,791 tree seedlings planted for natural regeneration of the soil.

Wood removed:

when the planted area reaches 10 years, trees that do not have adequate characteristics for the process are removed. In 2018, there were 19,693 tons.

Resination:

1.3 million trees were resinated, and in each one approximately 19 grooves were made, allowing the collection of 3,924 tons of resin, 3.4% higher than in the last period, registering 2.98 kg / face.

Gum resin:

26% collected from the forests and 74% from small producers, of which 16,494 tons were adherent to the Quality Resin Program, created in 2018.

Processing:

the gum resin goes through four stages, ending with the separation of the pitch from turpentine in a cycle in which we are able to produce, approximately, 1.1 ton of pitch and 275kg of turpentine.

Close cut:

made when the area reaches 21 years, totaled119,143 tons, traded in the regional market.

Main developments

We recovered 79% of the forest area burned in 2017 (1,255 hectares).

Investment in firefighting: a new truck and intensification in emergency brigade training. In 2018, 12 fire outbreaks were recorded, but none caused significant loss.

Adequacy and revitalization of structures and processes for greater security: allowed the optimization in the distillation batch cycle andinstallation of a new water system.

Implementation of the Quality Resin Program which encouraged suppliers to provide us with higher purity resins and less waste.

We performed four kaizens focusing on: planning and control of chemical production, forest fires, industrial maintenance and health and safety, with positive effects on the specific consumption of firewood, generated effluent volume, distillation productivity and reduced downtime.

Improvements in working conditions, offer of benefits, preventive follow-up of occupational diseases and continuity in training of operational leaders.

Dialogues with representatives of the local Community andconducted face-to-face visits to capture, record and address needs for preventive and corrective actions.

The future we want

Forestry

To complete, in 2019, the planting of the total area burned in 2017.

Complete the registration of the areas.

Reduce absenteeism rates.

Evolve in employee perception indices in the GPTW® Climate Survey.

Resin

Complete adaptation projects to NRs

Continue work focusing on cost reduction, productivity, profitability and market share.