Insight study by Pöyry indicates challenges for producers of paper and paperboard
World demand for paper and paperboard is forecast to grow to 482 million tons in 2030. This equals an increase of 1.1 per cent per year. This is the result of the new global paper market study “World Paper Markets up to 2030” by Pöyry Management Consulting. The study forecasts the demand for over 80 countries and country groups, and ten product areas, including graphic, tissue and packaging papers.
The demand for paper varies depending on type and region. The graphic paper market is facing huge challenges in particular, while increasing digitalisation is shrinking demand for newsprint and other printing papers, as well as uncoated and coated wood-containing and wood-free papers. According to the Pöyry study, the demand for tissue paper, containerboards and cartonboards will, however, grow up to 2030. This is driven by increasing packaging needs in emerging markets, booming eCommerce and the growing demand for convenience food and consumer goods brands. The annual consumption of packaging material and tissue/hygiene products will, thus, rise by up to 2.9 per cent.
Focusing on regional growth markets, it can be found that the demand for paper continues to grow in the emerging markets, such as China and India. This is due to the increasing population, urbanisation and the development of a new middle class. In Japan, North America and Western Europe, on the other hand, the demand will decrease by around 0.8 per cent per year up to 2030. “Since 1950 the production of paper has continually grown. But the last five to six years were extremely challenging for the global paper industry, in particular for companies in Western markets”, says Timo Suhonen from Pöyry Management Consulting.
As a result, Pöyry experts forecast a strong need for structural changes in the paper industry. “Especially in Western Europe we find an urgent need for further capacity reductions. After the markets in the emerging Asian regions have become more mature, the industry needs to take a more disciplined approach as to capacity expansions. Industry consolidation, acquisitions, mergers and alliances start making more sense there, too“, Mr. Suhonen adds. “In the past, exits from the graphic paper industry sometimes turned to entries into the packaging paper and paperboard sector through a conversion of the machines. However, this move would probably be the least painful one for multi-sector companies and always has to be decided on a case-by-case basis“.
The latest Pöyry Insight study “World Paper Markets up to 2030” addresses these and many other significant market issues that are of current strategic interest for all business participants, including pulp and paper companies, suppliers of machinery, equipment, chemicals and related inputs, investors, financiers, institutions, paper merchants and traders and logistics companies.