Tissue Sector in Eastern Europe

There are in total of 741.447.158 people living in Europe. This big number requires consistent productivity to satisfy people’s needs. Tissue paper is one of them.

Tissue paper and paper-based products, in general, are one of the most widely used materials. Accordingly, the European market for tissue paper has been growing 2-3% annually and the worth of the market is approximately 10 billion Euros, representing 23% of the global market.

The four largest markets account for half of the European tissue consumption and, as it shows on the pie chart above, only two Eastern countries are on the top 10 list.

Tissue Sector in Eastern European Countries

Eastern European countries are going through a dynamic phase with countries with large populations, such as Russia, and a rapidly evolving tissue sector, leading he growth from the front line. East Europe is a geographically wide region, which varies in countries.

The tissue sector in countries like Russia, Poland, Ukraine and Romania is very fragmented and features no leading player but shows a great capacity to evolve fast and lead the business from East to West.

This bar graph shows that in the past 10 years the growth has been the fastest in Belarus, Poland, and Russia, followed by Serbia and Romania.

Impact of the Economic Fluctuations

In correlation with the market, tissue consumption has also been developing but due to the political problems, it was not consistent. During the Great Recession in 2009, Eastern European GDP nosedived by approximately 6.5% but tissue consumption far less by 1.4%.

The consumption recovered in 2010 quickly and continued to heal in 2011-2012. However, since then, most of the Eastern European economies have struggled and the regional GDP growth has been below 2% per year. This economic condition has radically curbed the growth in tissue consumption in the past 3 years while the production showed a great increase based on investment decisions made during the 2010-2011 recovery.

To give a more specific example we can take Hungary on board. Hungary has one of the most advanced tissue markets in Eastern Europe, with its per capita consumption of 12.6 kg in 2015. It is high up in the ranking, as being second following Slovenia in the region.

There is only one major mill in Hungary which makes it’s market very interesting. Tissue converters also play a significant role in the supply system. Moreover, the existence of several important converters means that more than half of Hungary’s tissue imports are parent reels. These converters sell both brands and private labels, and some of them work as sub-contractors for large multinationals such as Kimberly-Clark and WEPA.

Private label share is more than 70% only in kitchen towels while in toilet paper local convertor brands have a strong position and private label share of below 50%.