The ongoing COVID-19 pandemic and ecology issue create conditions for a further growth of production of paper packaging both in Russia and Western markets, according to recent statements, made by producers and analysts.
In regard of Russia, according to the Russian Association of Paper Producers (Bumprom), which unites Russian pulp and paper players, in 2020 domestic producers of industrial paper significantly increase their output, with one of biggest growth rates being observed in case of packaging paper (+20%). At the same time the production of cardboard increased by 15%, while paper towels, toilet paper and other similar accessories - 10%. For some types of products, the result is even higher: paper bags and bags - plus 36%, bleached cardboard for corrugated packaging - plus 83%.
Amid the ever growing volume of production, prices for paper packaging in the Russian market also grow. In 2020 they increased by 30%, and since December 2020 they have been increasing by 5-15% monthly. This stimulates pulp and paper mills to restructure their activities: for example, the Volga mill (Nizhny Novgorod region), 80% of whose production in 2020 was newsprint has recently announced its intention to increase the share of packaging materials to 60%.
Analysts expect a further growth of production of paper products in Russia, that will be associated with an increase in the share of online sales, as well as the use of cardboard packaging instead of plastic. The Institute for Development Center of the Russian Higher School of Economics stated that there is a "rush demand" in the segment of sanitary and hygienic products (tissue), the popularity of packaging for food and other segments of e-commerce.
By: Eugen Gerden