The Iochpe Group and the Paper and Cellulose Business

Created in 1918, Iochpe started out in the logging sector. The company enjoyed progressive growth and invested heavily in lumbering and timber, with various sawmills in the states of Rio Grande do Sul and Santa Catarina supplying pine timber to the domestic and external markets. The lumber was transported south by barge along the Uruguai River, bound for the Platine market (Argentina and Uruguay), and by train to the rest of Brazil. Exports to North America and Europe embarked from the Port of Rio Grande.     

By the 1930s, Iochpe had depots of pine, hardwood and beams in the towns of Coxilha, Getúlio Vargas, Erebango, Quatro Irmãos, Capô-Erê, Viadutos, Marcelino Ramos and Boa Vista, as well as numerous pine forests.   

Always eager to expand and diversify, in 1942, Iochpe set up a modern and innovative “Mechanical Pulp, Laminated Wood and Plywood Factory”, equipped with imported machinery. This plant could be considered the Group’s first real production unit.    

The production process was relatively simple: immersed wood was compressed against a grindstone to produce pulp for packaging, paper bags, corrugated cardboard, toilet paper, paper towels, and newspaper, among other applications.   

At the time, a growing market and increasing demand called for higher productivity, and that meant more modern technology and greater capital investment in the acquisition of more complex machinery.  

Despite the local importance of pulp, the experiment with pulp production failed to yield the expected results and was discontinued after the installations were gutted by fire in 1947. 

Interestingly, forty years later, Iochpe would return to the paper and cellulose sector through its stake in the holding Riocell (Rio Grande-Companhia de Celulose do Sul), a partnership between Klabin do Paraná (52%), the Iochpe Group (42%) and Votorantin (6%), established in 1982.    

Riocell was a plant inaugurated in Guaíba (RS) in 1972 by the Norwegian enterprise Borregaard, a pioneer in the production of water-soluble cellulose made from eucalyptus. In the 1980s, the company, whose flagship line was bleached cellulose, accounted for 9% of Brazilian cellulose production and 15% of related exports.      

Iochpe held a stake in this business up until 1995, when it alienated its shares in Riocell in order to focus on the automotive industry.