Tissue World Projects
Survey 2011

Tissue sector continues along its significant expansion path despite recessionary climates

Click here to download TW’s 2011 Project Survey figures in PDF

Global tissue production continues to ride out the economic storm gripping many other business sectors and is progressing along its impressive growth path.

TW’s 2011 Project Survey reaffirms the recovery is already well underway in the years following the 2008 recession. Most of the indicators are that increasing and impressive numbers of people want tissue products, and unlike many other sectors, tissue has a clear view of a huge and untapped market which offers immense potential.

Growth across the global industry of 4.1% was established in 2010, and is accelerating. Research for this survey included asking machinery suppliers about their present and future developments, and the response charts new capacity being added, ordered or in final planning stages in 2011-2012. All the figures in the survey are based on the best information provided, and are subject to revision as, in many cases, information was not provided because it was deemed commercially sensitive, or subject to financial uncertainty.

It’s also the case that a distinctive feature of this time in the cyclical development of tissue production is marked, certainly in the east, by the timely closure of old facilities to make way for the new. Additionally, while globally very few projects have been stopped following the economic crisis, many have been delayed.

Last year the projected forecast going forward to 2011 was 1.7m tonnes of new capacity expected to come on stream. Some of those projects planned for start up in 2010 or in 2011 have seen delays, and some of the ‘new’ capacity announced this year in fact includes some of last year’s estimate. Taking that into account the suppliers’ re-adjusted figure reveals approximately 300,000 tonnes of additional new annual capacity, which results in a revised overall figure of approximately 2m tonnes of new capacity up and producing in 2011.

A considerable number of companies also issued projections for impressive tpd figures, which will add, in the terms of the survey, unknown capacity. There is every indication that the period between late 2011 and early 2013 is going to be particularly active for start ups.

According to the confirmed details in this year’s graph, it is expected that approximately 3.4m tonnes of new capacity will come on stream between 2011- 2012. China leads the way, and many new investments have also been announced in Latin America, and they are mainly expected to come on stream in 2013. New capacity is also occurring in the Near and Middle East, Asia Far East, North America and Europe.

In China, a massive programme of closing old and inefficient mills and building new large capacity mills with optimum width machinery is underway. Whether this will move the country into mass overcapacity is yet to be seen.

The Latin American tissue market as a whole is expected to grow at a rate of 4.5- 5% annually, which equates to approximately 1.8m tonnes of extra tissue in the next 10 years. That represents numerous new lines. The world average tissue growth is expected to be around 3.5-4% over the same period, so Latin America is clearly leading the charge outside of China. North American companies, meeting demand in overall tissue consumption which continues to grow at around 3% per year, continue to invest despite the less expansive economic times. However, this is also expected to be offset by a number of mill closures. What the new figures do confirm, however, is that it’s clear that impressive expansion is still underway. Recard president Piero Cardinotti told TW that the amount of new capacity coming onboard this year was as expected. He said: “2009 was the worst year following on from the recession, but since then things have become better.”

Rogério Berardi, sales and marketing manager at Voith Paper, said he had expected fewer projects, especially in Europe and North America following the economic crisis. He said: “2010/2011 was an extremely positive year in terms of new capacities and projects in all major regions worldwide, but mainly, and surprisingly, in Europe and the USA.”

It is still an uncertain market with a mixed picture of start ups and closures, and the recession has not as yet gone away. This picture can’t rule out some fears that the recession’s effects are still being felt in terms of planning for the near and mid future. But overall tissue remains impressively resilient.

All aggregates taken from the survey should be treated with some caution. While all care has been taken to publish comprehensive data, it is inevitable that projects will be missing or details incomplete. We welcome your help to ensure as comprehensive a survey as possible in 2012.