Rumo S.A. ($RAIL3)

Good afternoon. Thank you for waiting, and welcome to Rumo's First Quarter 2026 Earnings Conference Call. [Operator Instructions] This presentation is being recorded and simultaneously translation is available by clicking on the interpretation button. [Operator Instructions] Before proceeding, we would like to reiterate that forward-looking statements are based on Rumo's Executive Board's beliefs and assumptions and information currently available to the company. These statements involve risks and uncertainties as they relate to future events and depend on circumstances that may or may not materialize. We recommend that you refer to the disclaimer on the second page of the presentation. I will now turn the conference over to Mr. Felipe Saraiva, Rumo's Head of Investor Relations. Mr. Saraiva, you may begin the presentation.

Good afternoon, everyone, and thank you for joining Rumo's earnings conference call for the first quarter of 2026. Let me start with the highlights on Page 3 of the presentation. We have begun the year with a quarter of solid execution in line with our operating plan. We transported BRL 20.2 billion in the first Q, the all-time high figure for the first quarter and a 25% increase compared to the first quarter last year. The North operation was the main driver of this performance with BRL 16.6 billion RTK transported, up 27%. Higher volumes, combined with discipline in cost and expense management supported the improvement in our results. Adjusted EBITDA reached BRL 1.7 billion, up 7% year-over-year and adjusted net income was BRL 266 million, an increase of 41%. Investments amounted by BRL 1.8 billion, fully aligned with our plan for the period, and we closed the quarter with financial leverage of 2.1x. Moving to Page 4, I will present our market share. We gained market share in all of our main markets. In Mato Grosso, market share reached 38%, an increase of 2 percentage points. In Goias, we reached 33%, up 9 percentage points year-over-year. On a destination standpoint, our market share at the Port of Santos reached 57%, an increase of 12 percentage points. At the port of Paranagua and Francisco, market share reached 28%, also up 12 percentage points. These results point to a recovery market share to levels that are more aligned with the capacity potential of the railway. On Page 5, we show our operating indicators. Even though we delivered a significant growth in transported volumes, we maintained stability in our major operating indicators. Trends in the Northern operation was really similar to the previous year, while dwell time in Santos improved during the period. Regarding energy efficiency, unit fuel consumption improved by 6%. This is a clear evidence of the efficiency gains from our model of longer and heavier trains. On Page 6, I will present volumes by commercial portfolio. The Northern operation was the major driver for growth, led by grains but with increases across all of the portfolios. In the southern operations, higher volumes were supported by agricultural commodities, mostly soybeans, corn and fertilizers. Moving to Page 7, let's go through the revenue and yield highlights. Consolidated net revenue was BRL 3.3 billion, an increase of 11%, driven by higher transported volumes. Yields reflected the competitive repositioning cycle that has started in the second quarter last year and have just completed 12 months by the end of this quarter. Currently, we operate at a level of competitiveness that is better aligned with the logistic alternatives available in our major markets. We remain focused in maximizing our value through the efficient utilization of our capacity, balancing volume, market share and profitability. On Page 8, we represent the EBITDA. Adjusted EBITDA increased by 7% in the quarter, reaching BRL 1.7 billion. In the North operation, EBITDA reached BRL 1.6 billion, up 6%, supported by higher volumes and the fixed cost and expenses dilution. In the South operation, adjusted EBITDA reached BRL 141 million, up 10% with contribution from higher volumes and cost discipline. On Page 9, we move to financial results and net income. Net financial results were negative by BRL 846 million, mainly reflecting a higher net debt base and a higher average CDR rate, the local benchmark. Even so, we have delivered adjusted net income of BRL 26 41%, mainly supported by operational improvement. On Page 10, we will discuss the indebtedness of the company. Net debt closed the quarter at BRL 16.9 billion with financial leverage at 2.1x. We have a solid liquidity profile with BRL 5.9 billion in cash position and an extended debt maturity profile. Additionally, we have BRL 2.7 billion in committed and undrawn financial lines. On Page 11, I will present the investments for the quarter. We invested BRL 1.8 billion in the quarter, of which BRL 533 million was recurring CapEx 2 of expansion CapEx. In the Northern operation, which concentrates our expansion investments, we allocated more investments to the acquisition of rolling stock while reducing investments in railway network capacity expansion. At the Mato Grosso project, disbursement and physical progress remain in line with the plan with the start of operations scheduled for the third quarter of 2022. The new railway will strength our capacity to serve one of the main producing regions of Brazilian Agri. We will now move to an update of the soybean market on Page 12. The Brazilian soybean crop remains at the high level with production estimated at 18 million tons and exports of 115 million tons. In Mato Grosso production is estimated at 52 million tons with exports of around 33 million tons. Moving to Page 13 with the corn outlook. Brazilian production is estimated at 147 million tons with exports of 41 million tons. In Mato Grosso, the expansion of planted area by roughly 450,000 hectares supports the production in the state of around 60 million tons with exports estimated at roughly 25 million tons. It concludes my presentation, and now we are available for the Q&A session. Thank you.

Joining us today are Mr. Pedro Palma, Mr. Guilherme Machado and Mr. Felipe Saraiva. Before we begin the Q&A session, Mr. Pedro Palmer would like to say a few words. Please go ahead, Mr. Palma.

Good afternoon, everyone. Thank you for joining us on Q1 earnings conference call. The first quarter 2026 was in line with our plan. Rail and Rumo particularly has proven to be very competitive in Q1 and that with the right prices, the market does prefer our solution. You can see that reflected in the volumes we transported and the market share across our operations. Even at that price level, our margins continue to be very healthy. They are also healthy thanks to the operational excellence and our pursuit for energy efficiency, which has allowed us to continue to have healthy margins in our business. In addition to the verbal costs and energy efficiency, another key event is our management of fixed costs and expenses, which are also becoming more efficient in the company. Now if we look at our operations in the South network, we don't have any plans for expansion. And [ pre ] the maturity, we see a stability showing efforts to recall because we still have a negative cash flow for the company. On the other hand, on the North system, we have more robust extension plans. And also, still there is room to grow in the market. So the nominal value and fixed cost and revenue will tend to grow, but it will have to do so with great efficiency. And we've had the numbers based on the reduction of unit costs, which are a sign of excellent results for the company. Every time the North operation, the North system increases its RTK volume. That additional RTK comes in with a higher margin than the previous RTK and make sure that we continue to improve profitability, not only in this operation, but in the business as a whole. The pursuit for efficiency also happens in our capital cost and the CapEx. What we did in the first quarter was totally in line with what we have for our annual plan. Phase 1 of [ FMT ], which is our main project will start in the third quarter 2026. So I'd like to reiterate that it will happen within the same time window that we'd set halfway through '24 and for the same cost that we had announced. So I just want to reiterate the delivery of the first phase of this project, which is key for the company in the third quarter this year as we had planned. The other investments made this quarter are recurring investments in maintenance and expansion, and they're also according to our annual plans and forecast for 2026 as a whole. So the first quarter didn't have any major surprises, which is a very good thing. Now looking forward, we also hope to keep on the same trajectory. We're not expecting any great surprises in 2026. We'll continue to pursue operational efficiency maximizing volumes, working on reducing company costs and on improving our capital allocation within the business. I don't just want to talk. So let's start the Q&A so that I can answer any questions you might have about our earnings for the first quarter. Thank you, and let's move on to the Q&A.

[Operator Instructions] The first question is from Mr. Lucas Marquiori from BTG Pactual.

Thank you. Hello, everyone. Good afternoon. Let me take this opportunity to clarify the price repositioning program. You ended the pricing repositioning cycle. And I remember in the last Q earnings call, you mentioned price delivery in Q1, looking for parity close to 0 and maybe with a slight upside from Q2 to Q3, but the world has changed a lot, wars, oil prices, everything is going up. So I'd like to update what you've been seeing in your price curve both what you have already locked in. I would imagine you've locked in a large part of soybean, but if you have a curve for corn prices for Q2, that would be great.

Great, Lucas. This is Pedro. I'll take your question Well, what happened in Q1 was exactly what we had mentioned in the last call. When oil for the second quarter this year, we've already locked in our capacity. And let me reiterate what we had already said in our previous earnings release call, we should be seeing prices close to what we had in Q2 2025. Same price as Saraiva mentioned. In Q1, I said we would have a reduction that was just over 10%. We did deliver practically that slightly better actually. For Q2, we're seeing some stability compared to Q2 2025. And let's not forget that there are variations, 1% or 2% below coming from mix effect. So there will be some adjustments based on segments or origination clients, but -- we're talking about the same magnitude as we saw last year. So that's Q2. Now looking at -- looking forward, in the second half of 2026, we're practically sold 50% of our grains capacity and our sales plan for the period. The volume that we did sell was at the same level or similar level to what we saw last year. So we've locked in that volume at that level. Now as an aside, let me just point on diesel. Lucas, as you know, and others may have the same question. Our contractors go through a pass-through process. So the same amount we've locked in with the market. As diesel goes up, the price goes up by the same value, practically in absolute terms. So it's a natural hedging process, which is pretty much perfect for the volumes that have already been contracted. So that's an aside on the impact of the diesel going up or down. That does not change the contracted margin that is preserved. Now looking forward, what -- so there is some uncertainty in terms of results. But we're very positive about the second half of the year. As Saraiva said, the crops and exports are looking great in terms of product availability, especially corn. So we're very confident that there will be availability either because the crop is looking up, very healthy or because of the corn carryover inventory. So there will be product availability. Obviously, there will be some uncertainty because the market hasn't on contracted the other 50% of the capacity that's missing because everybody is on the same boat. Monitoring the international market, international demand for Brazilian corn is still uncertain, but that's natural for this time of year. I mean we're still at the beginning of May. Let's not forget that corn exports take place as of July. So our expectation is to sell the capacity that's missing over the next few weeks and months. But obviously, I can't give you an absolute answer. In terms of trends, macro trends and the competitive scenario in terms of future pricing, obviously, it should be marginally positive compared to what's already been contracted. Diesel going up has an impact on our competition because our solution is the most competitive in terms of energy efficiency. So that efficiency does place us in a better solution and favors our logistics solution. Also operational efficiency, the quality of our solution and being contracted, obviously, we'll bring in more volume to rumors system. And with higher volumes, production and normal operation flow will also benefit us. So we're seeing a positive scenario for what's yet to be contracted, but the demand has to be put on the table. So there's no sense of urgency. We're very happy with the volumes that have been contracted so far and what's in our pipeline for the second half of the year. Just like we executed on Q1 in line with our plan. The same applies to Q2, and I'm confident that we're going to have a great journey in the second quarter. That's something we work on every day so that we can get to that by the end of the year.

The next question is for Mr. Andre Ferreira from Bradesco.

Congratulations on your results. Could you talk a bit more or give us an update on the CapEx for 2026. Is it still in line with what you announced in the earnings call last quarter? And also, if you could provide some clarity on distribution. Do you think it will be more concentrated at the beginning of the year like we saw last year? Or do you think the pace will tend to go down over the next few quarters?

Yes. We do confirm that CapEx level and the company's investment program as we announced in the last call, it will probably be between the performance we had in 2024 and 2025. So between those two levels in the last 2 years, and yes, it will be more concentrated at the beginning of the year. That's very similar to the first quarter 2025 and it will get to that level over the year, the level that we shared with you. Obviously, in 2026, that will reflect on the movement to deliver the first phase of the Mato Grosso rail project as Pedro said and so did Saraiva during the presentation, we're fully compliant. We're on track the work should be concluded on time. I visited the terminal on Tuesday. And in May, we should start running tests on the terminal. So we're getting the structure ready, so that in the third quarter, we can have the operation up and running. So we're on track with what we had planned for the year, and there are no surprises.

The next question is from Mr. Alberto Valerio from UBS.

Could you update us on the return of the West and South networks? What's happening? And are there any news? Are you still in conversation with the government? We heard some news about Transnordestina. So if you could update us on those assets, that would be great.

There isn't any major news in the West network, what we can say is that we have started the process to make the institutional side, formal to return the asset in June. We have been saying that to you, and we are in conversation with the regulatory agency and the government that -- since there are no more operations since we have prepared everything, everything was ready, and we will now return the asset. So soon we're going to settle the accounts on that, but there are no surprises and no news. In terms of the South network, what I can share with you is that the government asked us to look into a temporary solution until we have a definitive solution to resolve the South network, where things are different. Some volumes are being transported there about 20 million tons. So we do need a solution that -- with a bit more fine-tuning and details. So we're just waiting to hear from the government, but that operation as it is today, is not sustainable in the future because it's in deficit. So we'll look into it. We'll hear what the government has to say. And when the time is right, and when we have more details we should have some news, which we will share with you.

The next question is from Mr. Gabriel Rezende from Itaú BBA.

I'd like to hear a bit more about the tariffs for the second half of the year. To us, there's a clear upside for Rumo because of the inflation rate in diesel we thought that the inflation would have an impact on the rail and road transportation in addition to your competitiveness. Now looking at more recent data on the road transportation dynamics, we still haven't seen that. the diesel dynamics having an impact on an inflation rate that's similar to that of road transportation. Road transportation is a bit more exposed and we don't know about a pass-through of the diesel price. Do you have any expectation for any upside on the second half of the year?

Thank you for the question. Yes. We have been monitoring what's been happening to road transportation in the last 2 weeks. And yes, we had expected a bigger increase than the one we saw. As Pedro said, Rumo has contracted half of its capacity in its grains operation for the second half of the year. And that half has been contracted at the same price level that we saw in the second half of last year. Now obviously, prices will keep up with the market. So if the road transportation market creates opportunities for some tariff increases, I can say to you that we are monitoring what is going on. But since this is still open, we're still waiting for definition. Clients are beginning to talk with Rumo to share the export curve for the second half of the year to start contracting, what hasn't been contracted yet. But -- it's too soon to know where those prices will land. We're optimistic about what we've been seeing for the second half, as Pedro said, we have a good crop coming from Mato Grosso. So there will be availability of products for exports. A point of attention is what will be the exports from that state? And what will be the demand level for the corn from Mato Grosso. And we'll make sure that rail is at a competitive level regardless of what's happening to the market, where it can be an attractive option. An attractive solution for clients. But it will keep up with the market in the second half of the year.

If I can ask a follow-up question. Based on your experience and since you're on the front line, much more than we are, negotiating seeing how the market is behaving. Are there any assumptions that you used to explain why broader expectation hasn't gone up? Do you think it's because the diesel went up too quickly? Is it the volatility taking a while to pass that through. Do you have any hypothesis internally to explain that delay?

Yes, we have a lot of hypothesis Gabriel, but they are hypothesis. Based on our experience, supply and demand are what matter and the pricing dynamics. So based on our experience, if prices haven't moved, it's because there is an excess demand in terms of logistics, and that's why prices haven't gone up. But that's for now. Let's wait and see what happens to the corn crop in the beginning of that journey. I didn't mention, but I think it is worth pointing out that in addition to corn, we are already seeing clients asking about soybean transportation, especially in Q3. So that will add to our logistics supply portfolio. But supply and demand always prevail when it comes to transportation prices and logistics prices.

The next question is from Mr. Guilherme Mendes from JPMorgan.

We've been coming from sales that have take place in advance the last few years rather than spot sales and shorter windows. Is management interested in working on longer windows. I mean, looking at maybe 2027, would management be okay with maybe giving up a bit of price for more visibility, take-or-pay contracts a bit more than we've seen in the past or not only in the second half of the year, but 2027, should we continue to see short-term sales?

The straightforward answer is that I would love to have the longest contracts possible. And I can give you an example of the pulp contract we have. The 20-year contract. We negotiate those contracts. And then every day, we discuss what to do with that asset base and how we're going to do that or the best way possible. But it works for pulp because my client produces it, controls the origination, they have an absolutely stable flow. They define how much is going to be exported. So there's zero seasonality for pulp. With the exception of the plant downtime for maintenance, which is covered by the inventory. It's up and running -- at full capacity, practically the whole year. So that dynamic doesn't apply to corn, for instance, which is the other extreme, our clients and the market that operates logistics is a market where they add volumes from different growers they try to match the origination flow with the demand on the other side of the world, whether it's from China, the Middle East, wherever the destination for that product might be. No trading company is absolutely certain if 2 to 3 years from now, what kind of corn volume they will need to send to Iran 3 years from now, for instance. They don't know whether they will be supplying run. They don't know if it will be their competition or if everyone will decide to buy from the U.S. just to give you an extreme example just to illustrate my point. So to sell a specific volume of corn forward with a 3- to 5-year contract now, the pricing level wouldn't be something I would agree with. We're better off analyzing the demand and being more competitive in a time line that can accommodate what the demand requires. So as a rail company, we are ready to work in any scenario. We can have 20- to 30-year contracts with clients, and we do. And we can also sell for the next quarter. If that's what the market dynamics are, our challenge is that we need to understand the different dynamics so that we can position ourselves as best as possible. Obviously, the price concession we would have to make to have that long-term peace of mind isn't worth it. So our mindset is to work on each portfolio according to the specificities pulp more than 20 years. Fuel to 3 to 5, sugar 3 to 5 years. Mill in the grains market is a type of product that is more stable, so we can have 1- to 2-year contracts. And grains and corn have more uncertain crops, greater international demand. So obviously, the sales time line is a bit shorter because that's the market dynamics. If you extend that too much, we'd have to give up on price and that's not worth it. So we work with different segments in different markets, and we just have to monitor them so that we can put ourselves in the best position without losing sight of the best results.

The next question is from Mr. Rogério Araújo from Bank of America.

Could we talk about your expansion investments? I noticed that you've shared some CapEx. Could you walk us through what qualifying the rail network or ports and terminals mean? Rolling stock is clearer. And where does the obligations with the Paulista network come into it? If you could give us some ballpark figure for your CapEx over the next few years, that would be great. And also, if you could provide us a bit more detail about Lucas do Rio Verde. We're concluding the first phase now. Will you begin the second phase investments as soon as the first phase is over? Or will you wait a while?

I'll start with your question about the new CapEx disclosure structure. And then -- we can talk about the Mato Grosso rail. We are reporting the company's expansion investments in three blocks: first, rolling stock, which is basically buying new cars. The second block is investments and improvements to the rail network. These are all investments that take place and go towards the rail. For instance, new yards any construction works to double rail stretches or anything to reduce operational risk like the security works and centers, region or urban conflicts, like building a bridge, all of those investments around the rail system are part of this group improvements to the rail network. So all the investments that are part of the Paulista network are substantially covered by these improvements to the rail network. Now when we look at improvement to ports and terminals, some investments can be made in increasing productivity in the existing terminals. Other investments might take place at the Port of Santos like the work on the right-hand margin. Those are the kinds of investments that we'll see in this about ports and terminals. About the Paulista network, we still have some remaining investments, which are concentrated until 2028, roughly BRL 1 billion a year. And from 28 to BRL 32 billion, a residual investment, which adds up to about BRL 5 billion to BRL 6 billion. That's the residual investment that's part of the Paulista network investment plan.

About the project, the Mato Grosso rail project, as I said, we're highly focused on delivering Phase 1 right now. the resources basically are for the first phase that we will deliver in 2026. We have not covered the Phase 2 of the Mato Grosso rail. So we're going to conclude, deliver and get the first phase up and running. And we're going to use some of the flexibilities that are available in the contract. We are compliant and have adhered to everything that was agreed on with the state of Mato Grosso. And we're also sensitive to cash generation and consumption. So we sized the investment plan so that the company can remain at a healthy leverage and liquidity level without reaching a contract or not keeping to the commitments we made. So that was the rationale. Investment level for the next few years, well, that will be based on fine-tuning our budget for the next years, especially '27. But what we can say for now is that we probably won't have investments that are that different to what we have planned for 2026. We should stay at that same level. Considering the end of Phase 1, we will acquire assets considering the growth of this terminal, which will open with a capacity of 10 million for the next 3 years. So that was the decision and those are the prospects for the time being.

We'll ask a follow-up question. That's without Lucas do, right, that CapEx level for 2026, if you decide to proceed with Lucas do, then you would add to 2027, right?

Yes, exactly.

The next question is from Mr. Pedro Bruno from XP.

If we can just go back to pricing, please. I'd just like to confirm a couple of things and ask a question. I just want to make sure what product we're talking about when you talked about your expectations looking forward. Guilherme talked about year-on-year freight in Q2, that is the same expectation of a few months ago when we had the previous earnings release call. So I just want to make sure what -- which product we're talking about. I think Saraiva mentioned grains. So I would just like to confirm that it is grains. The same applies to capacity. You talked about 50% of your capacity has been sold for the second half of the year. Is that just corn? Is it grains? Is it your capacity as a whole? What does it include? And also shouldn't diesel have already had an impact on Q2, which is already feeling the effect of the recent diesel increase? Because as Guilherme said, you're expectations haven't changed to having tariffs close to Q2 2025. But diesel prices are at a different level. So if you could also comment on pricing and grains in the north both from an industrial perspective in the North and the South.

Thank you for the question. We have been sharing where prices are going in our portfolio as also the second quarter of the year, we expect a convergence toward price levels that are similar to what we saw last year. I'm talking about the prices of the products in the north operation that are in our portfolio. This is what we report on our release. I'm not talking about any specific prices or products. I'm talking about the whole portfolio. Same applies to the south, price level should be similar to what we saw in the second quarter last year. Now moving to the end of your question, looking at our portfolio, especially industrial products like pulp or bauxite in the north operation or our sugar contracts. These contracts are pegged to the inflation rate. So they usually follow the inflation rate. Those are longer-term contracts. We don't negotiate prices every year. What changes or new contracts? Those might have some variance, but the change in those portfolios is based on the relevance of each of those portfolios for the company during specific periods, but there aren't any major fluctuations generally speaking, about capacity. Our capacity is overall, we don't have soybean capacity or corn capacity. We have an overall capacity. So we see that we've sold half of our capacity to the second half of the year, I mean grains in the north operation as a whole. Soybean, corn and mill, half of that capacity is still being negotiated with the clients. And to your last point about fuel in Rumo's commercial agreements with our clients, we have a margin protection mechanism to pass through fuel increases, both upwards or downwards. That's a neutrality principle. Rumo doesn't make or lose any money as fuel prices go up or down, we basically pass it on to clients. Fuel for rail is different to what we see at the pump. So even though there was an increase at the pump, the increase for rail is lower. The pass-through is at mid-March or end of March, but there haven't been any impacts on our tariffs because of the fuel pass-through and there haven't been any material changes to the unit fuel costs either. I think I've answered all of your questions, but please let me know if I have missed any.

Yes, you've answered them. To your first point, you said our portfolio as a whole and then when you talked about the North operation, you talked about pricing for the portfolio as a whole, you mean grains, right?

No, Pedro. No, no, let me make that very clear. It's the whole portfolio for the North operation, where we transport grains, sugar, fertilizers, fuel bauxite, pulp, there's the price for the whole North operation, which is the price we report on our earnings release. That yield that was reported will converge towards at similar levels that we saw in Q3 2025, okay?

The next question is from Mr. Filipe Nielsen from Citi.

I'd like to talk about efficiency and your volume increases. You mentioned that the additional volume improves the company's efficiency even after reprice yields and that maybe isn't going up that much. So you have a considerable operation ramp-up as of Q3, and I'm talking about Phase 1. You also commented that [ or ] transportation supply and demand, we still need to see what's going to happen to corn, but the pricing dynamics is pointing to flat prices in Q2. So what kind of margin or are there any other metrics you use? How much efficiency will you be able to gain in your operation considering all of these volumes? Or is that an ideal level? So I'm not going to over this volume because then my margin will suffer. I'd just like to understand how you think about that and what your math is.

I think the best way to answer your question is to give you a practical example of what happened this quarter in the North operation. Total volume that was transported in the North operation was 27%. So there was a 27% increase. When you look at the agricultural portfolio, that had a 31% increase. Obviously, there's a variable cost to transport all of that volume which is growing. However, considering our operational leverage by cost dilution. Some costs go up a lot less than the volumes. And you can see that in fuels and fertilizers, for instance. The total growth in the North operation was less than 8%. That has been a very positive journey for the company over the last few years. And this quarter, specifically, our efficiency was more than 6% in the unit cost of diesel consumption. So we are looking for levers to do that, we have been looking for a few years. I can tell you, as an example, more efficient trains, longer trains, heavier cost, we've been capturing that in 2025 and in 2026. Some of those initiatives are also bringing in additional gains through technology and the improvement of some rail processes and our cost structure as a whole. And that's not all. When it comes to fixed costs and SG&A as they increase because we're expanding our operations this year, there's a new terminal coming in, more rolling stock coming in that needs to be up and running. So if you look at the fixed costs, our efficiency is more than 15%. So as we transport higher volumes, which is our operational leverage model, that's what Pedro said. Every additional ton will provide us better returns because we are diluting our cost base. So that is a goal and a metric that we use with which we have been very successful in diluting costs in the last few years.

Let me just jump in to add a comment. This is Pedro Felipe. You mentioned market penetration. Let me give you the example of the Phase 1 of FNT, which will open this quarter. That terminal has a 10 million a year capacity for grains. That means that in '27, for instance, will increase our grains volume that's transported to 10 million tons. No. If we try to allocate 10 million tons in 1 year in the market, then we would need to bring prices down more than would be healthy for our margins and for the allocation of that volume. So we will use up those additional 10 million tons over the years, whether it's going to be in 3 or 4 years or 2.5 years, we'll practically decide that when the time is right, when the decision needs to be made by monitoring the market and current circumstances, logistic pressure at the time. But I can guarantee you that there won't be an additional 10 million tons of grains in the North operation. Well, this decide on the pace depending on the scenario. Anyway, I just wanted to give you a bit more color because, obviously, we do look at how much volume we can capture without putting pressure on market prices. So that we can be competitive and occupy natural spaces for us. But without destroying structural value for the whole chain, we have no interest in destroying prices in the mid to the long term in our segment. So we're very aware in our positions as leaders, and we're very aware of our responsibility in the logistics market.

The Q&A is now concluded. I would like to turn the floor over to Mr. Guilherme Machado for his closing remarks.

Thanks, everyone, for joining us on this earnings release call. This first quarter was very much in line with what we had planned for the first quarter of 2026. We have disclosed the volumes. So we're very confident about the company's ability to execute on those volumes and to go over BRL 90 billion RTK a year. Our strategy -- our pricing strategy has been very consistent, as Pedro said, and our pricing repositioning cycle is already bearing results, bringing in consistent volumes. The company's fair share in the market and healthy competitiveness for our business model. As for the second half of 2026, there's still some capacity to be contracted. We see some positive scenarios considering crop sizes, logistic pressure, increase in diesel prices. So we'll be monitoring transportation behaviors very closely, and we'll continue on delivering Phase 1 of Mato Grosso Rail within schedule and budget. The company is totally liquid. There are resources available to meet our cash needs over the year. We have credit lines that have been approved that we haven't used so far. So we're on track with our plan to deliver on what we promised for 2026. Once again, thank you for joining us. And we'll see you soon. Thank you.

Rumo's conference call is now concluded. Thank you for joining us, and have a great day. [Statements in English on this transcript were spoken by an interpreter present on the live call.]