Brazil’s Suzano CEO says $12-$13 carbon price could support forest regeneration

Brazilian pulp and paper maker Suzano’s (SUZB3.SA) chief executive Walter Schalka said on Wednesday that a market price of $12-$13 dollars per tonne for carbon could support the regeneration of one hectare of natural forest.

Schalka, speaking during the Reuters Next conference, said that regulated global carbon offset credit markets are vital to saving natural forests.

“Climate change is something we cannot procrastinate on anymore,” he said. “The way for the future to finance that will be through a global regulated carbon market.”

In October, Suzano brought forward a goal of removing 40 million tonnes of carbon dioxide from the atmosphere to 2025 from 2030.

The strategy to achieve such a goal includes retrofitting Suzano’s logging system, producing renewable energy that is used at its own facilities and other activities, the CEO said.

“In addition to that we are increasing our land base. The volumes of trees growing is bigger to volume of the trees we are cutting,” Schalka said.

Separately, to support biodiversity, the company is working to connect 500,000 hectares of fragmented forest areas in Brazil’s Cerrado savanna to preserve corridors for animals to move through, he said.

But Schalka said currently some of these projects do not have enough return on capital.