Paper industry in 2021 – global developments

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The paper industry has to face a lot of challenges: rising demands for high-quality packaging, an increasing number of online orders and a decrease in printed marketing collaterals. Recycled paper and packaging have become an abiding topic, especially during the pandemic. The book, newspaper and magazine business also has to face massive changes in the paper industry.

Global developments in the paper industry — © myrfa on Pixabay

06.05.2022

Source: Birkner News

From a global warming perspective, paper has become more and more important, too. Sustainable, environmentally friendly paper production matters for manufacturers, retailers, publishers, and consumers alike. Here is an overview of all the paper industry's global developments in 2021.

2021 ́s most important developments at a glance:

Trade price for blended recycling paper has risen drastically
September `21: Import prices for recycling paper and pulp higher than the previous month
Decrease in production of printing and writing paper in last 10 years
Producer price for packaging paper and cardboard has risen considerably

Considerably increased commodity prices for paper
As a result of the corona crisis, many paper producers have to face shortages in the supply chain leading to increased prices on the paper market. Above average price increases are especially apparent for commodities necessary for paper production like recycling paper and pulp.

Compared to previous months, trade prices for recycling paper have more than tripled in September ́21. Cardboard and paper remnants have also become increasingly expensive. This is also true for imported recycling paper. In September ́21, costs for importing were 75% higher than at the same time a year before. Timber and pulp – other important resources for the paper industry – also show considerable price increases.

Printing, copying, and writing paper production took a hit
The paper industry ́s development is worrying for printing works and publishers. Business with catalogues and magazines has only recently begun growing again since the impact of the corona crisis. But rising paper prices have made this positive development obsolete.

One reason for the massive price increase and the lack of high-quality recycling paper for printing wares like magazines and catalogues, respectively, is the decrease in the production of printing, copying, and writing paper in the last years. Compared to 2010 with 6.62 million tons of produced paper, 2019 has only seen 5.07 million tons of paper leaving production halls – a decline of about 23.4%.

Decline in paper production — © Birkner GmbH & Co. KG

As a result of the pandemic, the demand for flyers and printed marketing collaterals has dropped as public events were cancelled, which led to an even bigger decrease in production volume for graphic paper in 2020.

Throughout Europe, newsprint production has taken a massive hit, which resulted in a lack of paper for recycling – a vicious cycle for the paper industry as a whole.

What does that mean for the industry? In Germany, the paper industry has increasingly reoriented towards producing packaging paper and cardboard, turning away from producing graphic paper. For example, corrugated cardboard for cushioning packages and cartons is being produced more.

Importing large quantities of recycling paper
What ́s the paper industry ́s plan if there isn ́t enough paper for recycling? It does what all industries do: Import goods. A large quantity of necessary resources for paper production is being imported. From January to August ́21, they imported 3.41 million tons of cardboard and pulp for recycling. Timber and pulp imports have risen drastically in the same time frame.

And where is Germany getting its resources from? The bulk of all imported pulp came from the world ́s leading wood exporting countries: Finland, Sweden, and Brazil.

Imported pulp from Sweden, Finland and Brazil — © Birkner GmbH & Co. KG

Rising production prices for paper products
More and more online orders from online shops and the foodservice industry have led to an increased demand for cardboard and packaging in the private and business area. Rising commodity prices have increased production prices for certain paper products, especially for corrugated cardboard made of recycled paper.

In September ́21, this product saw massive price increases with up to 78.5% compared to the previous month. At only +5.3%, price increases for graphic paper have dropped a little, though.

Near 100% valorization for all of Germany ́s collected recycling paper
Germany ́s paper industry has recognized recycling paper ́s importance years ago. Since then, the branch has done good work in recycling. Today, almost 99.3% of paper, cardboard, and carton waste from private households and businesses are recycled.

Outlook: Is the paper industry back on the upswing soon?
An unforeseeable price increase and a drop in paper production: Leading experts like VDZ CEO Stephan Scherzer think that 2022 will be a tense year for the paper industry, too. Magazine publishing houses fear a devastating shortage of paper. The paper industry must prove itself as a reliable partner that doesn ́t overdo price increases and can guarantee supply for graphic paper.

https://www.spiegel.de/wirtschaft/unternehmen/preise-fuer-papier-steigen-weiter-kraeftig-a-3195fba6-e992-406d-8ba8-0a5cb5ac2e4a

https://www.destatis.de/DE/Presse/Pressemitteilungen/2021/11/PD21_N065_51.html

https://www.spiegel.de/wirtschaft/unternehmen/preise-fuer-papier-steigen-weiter-kraeftig-a-3195fba6-e992-406d-8ba8-0a5cb5ac2e4a

https://www.cebra.biz/news/markt/30-07-2021-papierindustrie-wieder-im-aufschwung/

https://www.destatis.de/DE/Presse/Pressemitteilungen/2021/11/PD21_N065_51.html

https://meedia.de/2021/10/12/zeitschriftenverleger-sehen-gefahr-eines-papiermangels-in-2022/

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