Company: SUZ
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001628280-25-020368
Chunk: 217

Company: Suzano S.A.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 19
Chunk 217
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 risk management

The Company is exposed to several market risks, mainly related to fluctuations in exchange rate variations, interest rates, inflation rates, pulp selling prices and commodity prices that could affect its results and financial situation.

To mitigate the impacts, the Company has processes to monitor its exposure and policies that could support the implementation of risk management.

These policies establish the limits and the instruments to be implemented for the purpose of:

(i) Protecting cash flow due to currency mismatch;

(ii) Mitigating exposure to interest rates;

(iii)Reducing the impacts of fluctuations in commodity’s prices; and

(iv) Changes to debt indexes.

Market risk management involves the identification, assessment and implementation of the strategy, with the effective contracting of adequate financial instruments.

  F-34  

Table of Contents

4.4.1 Exchange rate risk management

The fundraising, financing and currency hedging policies of the Company are guided by the fact that a substantial part of the net revenue arises from exports with prices negotiated in US Dollars, while a substantial part of the production costs are in Brazilian Reais. This structure allows the Company to enter into export financing arrangements in US Dollars, and to reconcile the financing payments with the cash flow of receivables from sales in foreign markets, using the international bond market as an important portion of its capital structure, and providing a natural cash hedge for these commitments.

Moreover, the Company enters into US$ selling transactions in the futures markets, including strategies involving options, to ensure attractive levels of operating margins for a portion of revenue. Such transactions are limited to a percentage of the net surplus foreign currency over a 24 36 1,000,000 1,500,000

The assets and liabilities that are exposed to foreign currency, substantially in US$, are set forth below:

                                                                                 12/31/2023                     
  Assets                                                                                                        
  Cash and cash equivalents                                    6,496,039                             6,432,557  
  Marketable securities                                           70,255                             7,378,277  
  Trade accounts receivable                                    7,090,160                             5,049,609  
  Derivative financial instruments                             3,887,100                             3,070,594  
                                                              17,543,554         21,931,037                     
  Liabilities                                                                                                   
  Trade accounts payable                                    ( 1,350,763)                          ( 1,625,011)  
  Loans and financing                                      ( 83,004,915)                         ( 61,