Operator: Good morning, ladies and gentlemen. And thank you for waiting. At this time, we would like to welcome everyone to Adecoagro's 26 Second Quarter Results Conference Call. Today with us, we have Mr. Mariano Bosch, CEO; Mr. Emilio Federico Gnecco, CFO Mr. Renato Junqueira-Santos Pereira, Sugar, Ethanol and Energy VP and Mrs. Victoria Cabello, Investor Relations Officer. We would like to inform you that this event is being recorded and all participants will be in the listen-only mode during the company's presentation. After the company's remarks are completed, there will be a question and answer section. At this time, further instructions will be given. Before proceeding, let me mention that forward looking statements are based on the beliefs and assumptions of Adecoagro's management, and on information currently available to the company. They involve risks, uncertainties and assumptions because they relate to the future events and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions industry conditions and other operating factors could also affect the results of Adecoagro's and could cause results to differ materially from those expressed in such forward looking statements. Now, I will turn the conference over to Mr. Mariano Bosch, CEO. Mr. Bosch, you may begin your conference.
Mariano Bosch: Good morning and thank you for joining Adecoagro's first half 26 results conference. Consolidated adjusted EBITDA marked new records. Reaching $258 million year to date and $173 million during the second quarter. Reflecting the earnings potential and scale that our well-diversified industrial platform now has. In fertilizers, stronger operational performance during the quarter resulted in higher production volumes, while higher prices and cost efficiencies supported further margin expansion. Given higher than expected prices during the first half, we expect the annual performance from this segment to be above our initial projections. In Brazil, the sugarcane plantation is in excellent conditions. The investments and work done over the years to improve cane productivity are paying off as weather conditions have normalized. Sugarcane availability is now driving the crushing volume growth. And this is also 1 of the reasons why we view the acquisition of Carapo Mill as highly accretive. We believe this asset will enable us to organically expand our sugar and ethanol operations by milling the surplus cane that our cluster currently has. While further strengthening our presence in the region. As we capture the operational synergies, we see potential to unlock value by increasing the crushing and consequently reinforcing our position among the lowest cost producers in the industry. Given its earnings potential, this expansion does not alter our deleveraging progress nor our target net debt to EBITDA for the full year. In Food and Agriculture, stronger productivity enabled higher cost dilution. Raw milk production has improved supporting higher processed volume in our industries. As a new crop is being commercialized, margins should improve supported by a more efficient cost structure. To conclude, I would like to express my gratitude to all the teams in Adecoagro. It is because of their commitment that we continue to achieve new milestones despite the different commodity cycles which we navigate. Thanks to our shareholders for their continued support And now I will let Emilio walk you through the numbers of the period.
Emilio Federico Gnecco: Thank you, Mariano. Good morning, everyone. Please now turn to Page 4 with a summary of our consolidated financial results. As a reminder, we are presenting our numbers on a pro forma basis assuming our fertilizers business had been part of Adecoagro since the beginning of 2025. We believe this provides a more meaningful year over year comparison. Gross sales total $535 million during the second quarter. While on an accumulated basis, they reached $928 million. Despite higher revenues in our fertilizer segment overall revenues remain in line across both periods. Reflecting mixed prices and volume dynamics across our product portfolio. Adjusted EBITDA set new high records. The main driver was the strong performance of our fertilizers business, which benefited from higher production, stronger pricing, and operational efficiencies. Such performance more than compensated for the softer results in the sugar, ethanol, and energy and food and agriculture businesses which I will discuss in a moment. Let's move to slide 6 and review the financial and operational performance of the sugar, ethanol, and energy segment. Despite experiencing above average rainfall, particularly in May, we crushed 3.5 million tons of cane during the quarter. up 3% compared to the same period of last year. This continues the positive trend we have seen since the start of the year. Can yields have recovered thanks to the better moisture conditions. Although TRS levels remain below last year's, they have been improving steadily throughout the year. In terms of product mix, we continue to maximize ethanol production given its attractive premium over sugar. As a result, we reached a 78% ethanol mix year to date. By comparison, during the first half of 2022, we maximize sugar production. This shift highlights 1 of the key advantages of our industrial assets, the flexibility to quickly change production toward the product offering the highest marginal contribution. On the cost side, production costs were negatively impacted by the appreciation of the Brazilian real. Excluding the FX effect, our year to date production cost in local currency remain in line with the previous year. Turning to sales. The decline we saw this quarter was mainly driven by lower sugar prices and lower sugar volumes sold reflecting the change in our production mix. For ethanol, lower sales volumes were actually part of our commercial strategy. Following the sharp decline in domestic ethanol prices caused by higher market supply, we decided to start building inventories rather than selling at current market prices. As a result, we finished the quarter with about 41% of our year to date ethanol production stored in inventory, positioning us to capture stronger margins once prices recover. This follows the strategy we implemented during the first quarter, we sold inventories and current production while prices were at their peak. Ahead of the new harvest. Overall, adjusted EBITDA reached $53 million during the quarter and $94 million year to date. The decline compared to last year reflects lower sales as well as lower Consecana prices in the mark to market valuation of our biological assets particularly harvested cane. Looking ahead, crushing is progressing as planned. And we are still on track to achieve our full year target. We continue to expect low double digit growth in crushing volumes this year supported by greater cane availability. Now let's turn to slide 8 to discuss our fertilizers operations. Urea production increased 22% year over year driven by higher plant utilization and, importantly, zero downtime during the quarter. As a result, year to date, urea production reached 617 thousand tons, remaining well above last year's level which was impacted by 31 days of downtime due to adverse weather conditions that disrupted gas supply as discussed on previous calls. On the commercial side, results benefited from a significant increase in international urea prices. Following the escalation of the conflict in The Middle East, a region responsible for roughly 30% of global urea trade, prices reached nearly $800 per ton during the quarter. As we executed sales throughout the period we were able to progressively capture the surge in prices. Accordingly, adjusted EBITDA more than doubled both in the quarter and on a year to date basis. In addition, higher production volumes together with operational efficiencies drove a meaningful expansion in margins. Although urea prices have moderated from the peaks reached in April and May, we still expect full year EBITDA from this segment to be above our original projections. This outlook is supported by higher prices captured in the first half of the year while most of our cost structure remained fixed. Please move to page 10 where we describe the performance of our food and agriculture segment. So at the end of July, we harvested 92% of the planted area, achieving yields above the prior campaign and producing more than 1.1 million tons of crops. We expect to complete the harvest season during this month and have already begun planting activities of our winter crops for the next season. In dairy, processing volumes increased compared to last year, driven by higher raw milk production at our free stall facilities due to better cow productivity. Looking at financial performance, year to date results still reflect lower commodity prices across much of our portfolio, along with higher costs in US dollar terms. That said, if we focus on the quarter itself, both revenues and adjusted EBITDA improved year over year supported by higher production volumes, and a gradual recovery in margins as we begin sales of the new harvest. We expect margins to continue improving over the next few quarters as the benefits of our cost reduction initiatives become more visible. In dairy, we also expect to continue growing processed milk volumes supported by the launch of new products under our consumer brands. Let's move to Slide 12 and review our capital allocation strategy. Starting with expansion CapEx. Year to date, our largest capital deployment was the final payment of approximately $400 million related to the acquisition of Profertil, which was completed during the previous quarter. At the same time, we continued investing in a number of attractive organic growth opportunities across our businesses. These investments include the expansion of our sugarcane plantations and biomethane operations in Brazil, as well as additional agriculture machinery, and a new cheese packaging line at our Morteros dairy facility. Before moving on, I would like to highlight that these figures do not include the acquisition of Carapo Mill. Which remains subject to customary closing conditions. We expect the transaction to close in the coming weeks, with the purchase price paid in cash at closing. Given the estimated earnings contribution from the asset, we do not expect the acquisition to affect our deleveraging targets for year end. Now let's move to page 13 where we present our debt profile. As we typically experience at this point of the year, net debt tends to peak due to the seasonal working capital requirements associated with our agricultural operations. If we exclude that seasonal effect as well as the $58 million increase in readily marketable inventories during the quarter net debt would already be below 2022 year-end levels. On a pro forma basis, net leverage stood at 3x which remains consistent with our deleveraging path. And reflects the stronger earnings generation we are seeing across the operations. Despite the seasonality in cash needs, and our commercial strategy, to hold inventories for some of our products in anticipation of better pricing opportunities. Looking forward, we continue to expect leverage to decline as EBITDA generation increases. On the liquidity side, our ratio improved to 1.9x compared to 1.2x in the previous quarter, demonstrating our ability to comfortably meet short term obligations. Please note that most of our debt remains long term, and that its currency composition is closely aligned with our revenue profile. Helping reduce foreign exchange risk. Finally, regarding shareholder returns, the first installment of our annual cash dividend totaling $17.5 million was paid on May 19. Equivalent to $0.12 per share. The second installment in the same amount will be paid in November resulting in a total annual cash dividend of $35 million. Thank you very much for your time.
Operator: We will now open the call to questions. Thank you. The floor is now open for questions. If you have a question, please write it down in the Q&A section or click on raise hand for audio questions. Please remember that your company's name should be visible for your questions to be taken. We ask that when you pose your question that you are picking up your headset to provide optimum sounds quality. Please hold while we pull for questions. Our first question comes from Gustavo Troyano with Itau BBA. Sir, your microphone is open.
Gustavo Troyano: Hello, everybody. Thanks for taking my question, and it is actually on Profertil. And more specifically on the mismatch between production figures in the quarter and sales volumes that you reported for this quarter as well? And, basically, I just wanted to hear from you what could be attributed to the usual seasonality of sales volumes, and what could relate to maybe 1 off in the quarter potentially driven by urea price spike or something like that. And still on this point, maybe if after the first half, if we should expect that the clogged urea sales volumes for the full year to reach the 1.3 million tons for the full year concentrating volumes in the second half or if there could be some downward adjustments to sales volumes after what happened throughout the first half of the year. Thank you very much.
Mariano Bosch: Hi, Gustavo. Thank you very much for your question. I think this helps for a whole clarification of how we sell the urea We produce 1.3 million tons per year So we are going to sell 1.3 million tons in the whole year. Argentina consumes 2.5. So there is no way that we can not sell the 1.3. So 1.3 is for sure something we will always be selling. And we could be selling all what we produce every month, and that is easily easy to do it. But we have a strategy where usually and in general, over the years, during September, October, and November is the maximum consumption of the urea from producers. So in general, that would be where the higher prices in the domestic market of Argentina, we can find. So we try to concentrate more sales in that specific part. That is for the general years. This year in particular has, as you mentioned, this peak because of the war during March and April, So in April, we try to maximize the peak that is why we are selling more than what we order originally projected in the first half So what you can see there is the first half, we sell more or less the average that has been sold in the previous years But in this specific year, we were pushing to sell more but in June, you may not remember, but in June, the price of urea went down as far as lower than the previous year. So an lower than July and August, So during June, we had the lowest price of urea that is why in June, in particular, we decided not to push on the sales we were pushing in April and May on what we had produced. So that is specifically why this particular month or this particular quarter, you are not selling all the production being sold. And we are happy with that decision because in June, the price was lower than today's prices or July and August. So we have more inventory today to be sold during a at a higher price. Of course, we would have sold a 100% in April. That is the maximum. But in April, we push and we try to sell as much as possible, but we could not. This is a spot price that every week is being sold and that is how urea commercializes in general. So that is important to make that specific clarification, and thank you for the question.
Gustavo Troyano: that is clear. Thank you very much.
Operator: Our next question comes from Matheus Enfeldt with UBS.
Matheus Enfeldt: Hi. Morning, everyone. Thank you for the time. My first question on sugar and ethanol, you had previous calls mentioned the expectation of a drop in cash cost. Of 10% to 15%, if I am not wrong. If you could provide any updates around that level of cost efficiency or cost improvements for this crop. If you still think that number is reasonable when you are looking to the entire crop. that is my first question. And then the second 1 on the acquisition of the Carapo. Mill, I understand there is potential synergies to capture higher crushing. My question is, what is the excess capacity or excess sugarcane that you currently have? And how do you think or how do you do you anticipate that cost move with a higher or a larger radius for sourcing once you end that plant? And if you could sort of help us get a sense around that. And then just to finalize on that on what is a reasonable outlook for crushing for that mil for 2027 if it is already possible for you to reach 4, 4.5 million tons above the 3.5 that the that the mill crushed last season. So those are my questions. Thank you.
Mariano Bosch: Hi, Matheus. You for the question. On the projection of the yield of the milling, the full milling for Carapo on 27. We do not give that guidance, and we want to close first, and then we will explain more details on Carapo On the rest of the questions, including some of the synergy from Carapo, Renato can take the cost and how the cost can be impacted with Carapo and what are the synergies, say, also with Carapo. Renato?
Renato Junqueira-Santos Pereira: Hi, Matheus. Thank you for your question. So as it was mentioned, we see Carapo as an extension of our cluster in Mato Grosso do Sul. So we are going to adopt the same operational model there and you have the same competitive advantage. So our plan in the future is to do the continuous harvest, We are going to take advantage of the high production flexibility that Carapo also have high cogeneration potential the ICMES tax rebate it is exactly the same as our mills in Mato Grosso do Sul. And we think that Carapo has a potential to increase the effective crushing a lot almost double the crushing. This is because the capacity of Carapo is very similar to the capacity of EVMMA if you consider the milling, capacitance, the sugar production capacity, ethanol capacity, it is very similar to Angelica and Ivinhema mills. We also think that we have a lot of opportunities to improve some KPIs and to reach the same level as you have in Mato Grosso Do Sul for example, industrial efficiency we think we have 2% higher than Carapo The use of time is also more than 2% higher the cogen exports, kilowatts of energy per ton of cane crushed. We think we can improve. Also some improvements in agriculture both in yields and TRS. And to finalize the synergies, think that we have a lot of synergies related to G&A, So we are going to keep the same structure that we currently have to also to use this in Carapo. And we are going to also to benefit from the logistic, the assets. We are going to take advantage of the tanks that Carapo has, warehouse, So I think there are a lot of synergy to that we are going to get in the next years. Of course, part of the sugarcane, as Mariano mentioned, from the cluster, we are going to send to be crushed in Carapo. Regarding the other part of your question, the cost I think it is important to say that quarterly cost have some temporary distortion caused by cost allocation in industry industrial seasonality. So it is better to analyze the costs based on the year cost But even with this consideration, we think that is still possible to reach a 10% reduction in cost compared to last year. I think this is explained first by the cost dilution We plan to crush 10%, approximately 10% more than we crushed last year. We still have not plenty of time to do it. Of course, it depends on the weather, but at this point, it is still possible. And so this has a extra cost dilution. The leasing cost is much lower because of the Consecana price. The headcount has been reduced. This is because of some efficiencies that we have been obtaining especially because of the use of new technologies such as through row harvesting machines, and drones. So we have decreased the number of harvesting fronts. So reducing the number of people working on those fronts And this is more than enough to offset some diesel and fertilizer increase in cost. So we think still possible to have this 10% reduction.
Matheus Enfeldt: that is helpful. Thank you.
Operator: Once again, if you have a question, please write it down in the Q&A session. Or click on raise hand for audio questions. Our next question comes from Pedro Gama with Citi.
Pedro Gama: Hi, Mariano and Adecoagro team. Good morning. Thank you for the opportunity to ask questions. So on my side, I have 2 questions in the fertilizer segment. In the past, the management highlighted that the likely expansion of the Profertil plant as a key growth avenue However, during the previous weeks and months, a major Argentinian in the gas sector announced investment in a new greenfield urea plant in the same region as Profertil. Building on that, I would like to ask about 2 questions. First, how does the Profertil current cash cost structure compare to this peer that is vertically integrated in gas production compared self. And is the unit cost difference significant? And how does this affect Adecoagro long term compact position in the Argentine arena? And another question, given that the likely Profertil expansion is a brownfield project, Should this directly be faster to implement And what is what would be the key triggers or market conditions required for you to make a final investment decision? Is that in a strategic urgency to bring this new capacity online before your competitor, thereby capturing a first mover advantage in the domestic market, which usually has higher margin than exports to Brazil, for example, or could this expansion be post in light of the company's focus to deleverage? These are the main points. Thank you.
Operator: Thank you, Pedro, for your question.
Mariano Bosch: Very important. Number 1 is South America consumes 10 million tons consumes no imports. 10 million tons of urea. 10 million tons. We produce 1.3 million tons. And the announcement is to produce 2.1 million tons So there are still a lot of need of urea in the whole region. This announcement is to produce urea in 4 or 5 years from now. So there is still a lot to go. When you ask to compare the cost of production from 1 system to the other, still allow to understand on what is the other cost. We know exactly what are our costs, but there are a lot of costs on the other side that still need to be understand. Understood. In terms of gas and the cost of gas, the gas is a very transparent market. And we have to renew our contracts as we said before, and we expect those contracts to be better in terms of prices and what they are today. And we are having offers of gas way cheaper than today. They are still a lot of gas available in the region. So if we do not see any disadvantage in buying gas in the region to the competitors or any other competitor there in the region. Argentina, as we have been explaining for many times, will be a huge exporter of gas. So we are always gonna be a buyer of gas at the cost of the export parity as we have been always saying. That is gonna be very competitive. So we still believe that we are going to continue to be the lower cop producer. And when you think on the selling on the domestic market, or on the export, depending on where because with the logistics and the port that we have in Bahia Blanca, we are very competitive to go to Brazil as competitive as to go to Puerto San Martin that are the northern ports in Argentina. Argentina. So the difference is between the domestic and the export market when we on the Brazilian market. Is not gonna be really relevant. So that is to understand what the impact of a new plant is in the whole 10 million tons that the region is importing. And then going to our own project that you were asking, we continue to understand, analyze, go in deep, do the engineering, work on the engineering on our brownfield projects. And, of course, we have lot of benefits because of having a brownfield project there. We know exactly where the location of the plant and where it is gonna be. Behind the existing 1. There are a lot of synergies with our existing assets. So we are still very keen on that project We are very interested on continue to understand. And also continue to understand what is the real cost of producing it of building the plant, and how is the best way to produce this plant or to build this plant in order to continue to be the low-cost producer. And there is where we are focusing and how efficient is that we can build this new plant that, of course, is a relevant development.
Pedro Gama: Very clear. Thank you.
Operator: Our next question comes from Lucas Ferreira with JPMorgan. Your microphone is open.
Lucas Ferreira: Hi, guys. Thanks for the time. I have 2 questions. The first 1 on the commercialization strategy for sugar and ethanol Renato, if you can talk about in your view, what are the reasons for ethanol prices to be extremely low, right, at this point, and how the company is reacting to that, I guess, you know, looking at your numbers, you are carrying a large amount of inventories to be sold later in the crop. So how much of capacity you have to carry if that is, you know, still the strategy that you guys are rolling for the second half of the year? And then on the sugar prices, if this recent rally in prices, you know, drives you guys to accelerate selling? And if this is already, you know, levels that you think are good enough to do a major acceleration of selling there in the market? And then if I may, a second question. More on the Argentina farming side. A bit of your outlook considering that we have El Niño coming in The business has been, you know, more and more challenging the last few years. How much of a recovery in, let's say, normal level? What you think is sort of a baseline yields for the crops and potential yields for the crops? So how much of that gap closure we should see assuming that, you know, El Niño will mostly support rainfall, right, in the country. Thank you very much.
Operator: Thank you, Lucas, for your question.
Mariano Bosch: I am gonna ask Renato to answer the commercialization, the sugar and ethanol and our strategy with sugar now, Renato.
Renato Junqueira-Santos Pereira: Hi, Lucas. So starting with ethanol, So I think the supply of ethanol was high. Due to the progress of the sugarcane harvest in the corn ethanol So that is why prices decreased a lot, especially in June, and July. With this price, the parity rate at the pump decreased as well. So the parity rate is lower than 70%. And since the early August we have started to see some signs that demand is picking up. So more liquidity. So we have already seen increase in price compared to July. about 5% Now what we are doing, and I think most producers in Brazil are doing too, is switch the mix to sugar So this the this is going to decrease the supply of ethanol So we think that the combination of a lower supply and a higher demand, I think the situation for the Q4 and Q1 is going to be better. that is why our strategy is to carry as much of ethanol as possible to be sold at this point. We have capacity to carry our production, especially because we have also switched the mix to max sugar. And, of course, in few weeks, we are going to have all the tanks of Carapo that we can use to store our production. And regarding to sugar, we think we are in a moment that the marketing is shifting from a 3 million tons of surplus to a deficit of about 2 million tons for different reasons in the most important production countries, India, Thailand, European Union, and Brazil. And if you take this fact that the lowest stocks worldwide, so the usual ratio is still very low. If you think the whole picture, we think the price of sugar has reacted because of this situation. And we, of course, we are taking the opportunity that the market is giving us in these rallies. To increase our hedging both 2026 and in 2027. Today, currently, are 70% hedged in 2026 at $0.157 per pound and in 2027, we are about 16% hedged at $0.174 per pound. This is not counting Carapo production.
Mariano Bosch: Thank you, Renato and Lucas. Finally, on El Nino that you were asking on the impact in Argentina. We have an impact on the yields in general, where we expect normalization of yields or improvement of yield. And that is, of course, welcome, and that is also including a benefit in terms of the whole cost structure that we have for the food and agriculture business. And, even more important than that, because of El Nino, we are also seeing a rise in the price of rice that rice is an important product that we produce in Argentina and Uruguay. So that we will have an even higher impact. So in general, El Nino for us is a positive scenario. On top of that, the needs of urea are higher the whole agriculture of Argentina because of more rains So, usually, the consumption of urea in the whole country is higher because of an El Niño projection. Thank you very much, guys. Thank you, Douglas.
Operator: Our next question comes from Isabella Simonato with Bank of America.
Isabella Simonato: Hi, Mariano Emilio. Good morning. Thank you for the call. I have 2 questions. First, since we are talking about, the food and agriculture business, right, this year, you reduced planted area significantly, right, given the economics But now we are ahead of maybe a more favorable scenario. Prices picked up a little bit, yields as well. If you can give us a sense how can we think about planted area for the 2027 campaign? I think this will be this will be very, very helpful. And second, I mean, back to the sugar and ethanol discussion. Right? I think we talk a lot about the surplus of deficit in the sugar market, but we have been seeing indeed in the inventories lowering declining, right, over the past few seasons. But that has not necessarily has been translated into prices that we have seen in the past with similar level of inventory. So part of that, I believe, is China running with lower inventories or the trade flow that is still balanced with Brazil producing above 40 million tons. I mean, you explain, I mean, in your views, what would actually need to happen, globally for prices of sugar to go back? To $0.18, $0.19, $0.20 per pound. Thank you.
Operator: Thank you, Isabella, for your question.
Mariano Bosch: Regarding Food and Agri and the planted area, you should not expect differences to this year. We are maximizing, returns We are being very focused on only leasing and planting the areas where we continue to see the returns that we are looking for So I do not see that changing in any significant way. At least I do not see that area growing significantly. And regarding the sugar and ethanol and what is the scenario or what should need to happen to go back to the $0.19 per pound in sugar. So Renato, if you want to add something to what you have already said?
Renato Junqueira-Santos Pereira: I think it will depend a lot on the El Nino impact on the key countries Of course, the impact can be higher or lower, So this switch from 3 million to 2 million deficit, I think, can be higher depending on what happened in those key countries. For example, in India, you know, that the stocks are very low. They are announcing some measures to avoid importing sugar, but it, of course, is going to depend on the monsoons that is going to happen there. In Thailand, the same thing. And even in Brazil, despite the higher cane availabilities that we have in Brazil, I think there are a lot of interruption in the crushing, the TRS content especially in June, was lower than everybody was expecting. The mix is less sugar oriented than everybody was thinking at the beginning of the season. So I think all those variables are going to impact the deficit, the size of the deficit, and the and the price of sugar in the coming months. And I think that the world has learned to deal with lower stocks maybe because of higher interest rates, improvement in logistics, But of course, the fundamentals at some point has to prevail and price has to increase Very helpful.
Isabella Simonato: Thank you.
Operator: Or click on raise hand for audio questions. Our next question comes from Thiago Duarte with BTG Pactual.
Thiago Duarte: Yeah. Hello, everybody. Yes. My question goes back to the Carapo transaction and I think to Renato. To 2 things here, Renato. The first 1, when we look at M&A deals in the industry, I guess 1 of the historically most challenging aspects is the quality of the sugarcane that comes along with the meal. Right? So my first question to you is whether you have a view on the quality of the cane that you are going to be harvesting coming along with the mill, with the Carapo mill in terms of you know, cultural treatments, in terms of the especially the longer cut cane, 5th cut or 6th cut cane. I do not know if you already have a view on that. And the second 1 is related to when you talk about the optimism about raising the crushing volumes or almost doubling the crushing volumes as you said, what you would say is the necessary CapEx you are going to have to do in terms of the expansion of the planted area? Or similar investments that will need to be done or you think you will have the additional 2.5 million to 3 million tons of cane available from your existing plantations. So these would be my questions. Thank you.
Mariano Bosch: Thank you, Thiago, for your question, Renato.
Renato Junqueira-Santos Pereira: Okay. So, Thiago, we think that the region is very similar to our region. The potential to produce sugarcane is exactly the same as Ivinhema. So the potential to have the tons per hectare in the kilograms of TRS per ton of cane is exactly the same. Of course, we are going to adjust some treatments because we have different methodology to treat the sugarcane that they are using today. But we think that is something very quickly to fix. And probably you will have a better cane in the near future. And regarding the excess of cane that we have in the cluster, I think that we have already something close to between 500 thousand tons and 1 million tons that could be diverted to be crushed in Carapo for the next 2, 3 years.
Mariano Bosch: But, of course, in order to achieve 6 million to 7 million tons which is very possible considering the industry that we are acquiring. Of course, we have to plant more So the only additional CapEx important CapEx that we need to do to achieve these levels. Is to plant sugarcane The industry is almost done.
Renato Junqueira-Santos Pereira: So few investments have to be made to achieve this level.
Mariano Bosch: Okay. that is great. We visited the plantations and the plantations are in a good shape today, which not something that has to be changed Just a clarification.
Thiago Duarte: Oh, that is perfect. And I think Renato you also mentioned that you see possibility to improve the yields of the cogen. In the mill. So the question there would be if there is also, you think, a CapEx associated with it in terms of improving the megawatt per ton generated?
Renato Junqueira-Santos Pereira: Yes. There are some CapEx, but it is a small CapEx. We are going we are thinking about things like isolate the main equipments So we are going to improve the consumption of energy in the mill. So if you consume less energy, we have more energy to be exported. But those investments are not big investments like acquiring a new boiler, so we are not thinking about this type of investments, just some adjustments in things that we have already seen in our visits at the mill.
Thiago Duarte: that is perfect. Thank you.
Operator: This concludes the questions and answers section. At this time, I would like to turn the floor back to Mr. Bosch for any closing remarks.
Mariano Bosch: Thank you all for participating today, and we hope to see you in our next calls. Thank you.
Operator: This concludes today's presentation. You may disconnect at this time, and have a nice day.