Strategies and Competitive Advantages
The two industrial units, Jalles Machado and Otávio Lage, have a total processing capacity of 5.3 million metric tons/crop, with fully owned sugarcane and fully mechanized planting and harvesting.
Located in the state of Goiás, the plants have several tax benefits and less competition for land than in the Southeast region of the country.
In the domestic market, Jalles Machado focuses its sales on the North and Northeast regions, where its sugar, sold under our Itajá brand, is widely recognized. Our organic sugar production is sold in major national retail chains, but it is mainly destined to the export market. More than 20 countries import Itajá organic sugar, especially the United States and European countries. Both white and organic sugar have a high price differential compared to VHP sugar. Currently, Jalles Machado is the world’s second largest producer of organic sugar and the largest exporter to the U.S. market.
In cogeneration, the Company has long-term contracts, adjusted by inflation indexes (IGPM or IPCA), providing a highly stable and predictable cash flow. The surplus is sold in the spot market, having commanded attractive prices in recent periods.
Jalles Machado is a benchmark in agricultural activity. The Group has been able to increase the longevity of the sugarcane field, achieve high agricultural productivity and reduce cutting, loading and transport (CCT) costs thanks to the adoption of precision agriculture, with the use of GPS and automatic pilot in part of the fleet; the use of inputs at variable rates, allowing the use of agricultural inputs in the quantities required by each area; long-term partnerships entered into with research institutes such as CTC, IAC and Ridesa, which, among others, helped create sugarcane varieties specific to the region’s climate; and the small average radius.