European Pulp and Paper Industry: Challenges and Resilience in 2023

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Cepi's 2023 Final Summary and Statistics Report for the European Paper Industries

In 2023, amidst an exceptionally challenging economic environment characterized by reduced consumption and significant destocking, many pulp and paper companies experienced a decline in turnover. The industry also achieved a record high annual recycling rate, highlighting its self-sufficiency and commitment to circular practices.

The 13% decline in paper and board production in 2023, driven by weak demand, was more severe than during the Covid-19 crisis (-4.7% in 2020). This trend extends beyond Europe, exacerbated within the EU by high production input costs, particularly energy. The broader European economy faced headwinds including a high cost of living, monetary tightening, and subdued external demand, contributing to the industry's challenges.

Production across all paper and board grades saw significant declines in 2023, with varying degrees of impact observed among different grades. Specifically, packaging grades experienced an 11% reduction compared to 2022, while sanitary and household paper production decreased by approximately 4.0%.

Despite these trends, the pulp and paper industry demonstrated notable resilience in 2023, achieving an impressive recycling rate of 79.3% — or 74.4% on a three-year rolling average. It continues to embody a strong "made-in-Europe" ethos, sourcing 91% of its fibers from within the European Union. Additionally, the sector recorded a positive trade balance for market pulp, marking the first occurrence of such since Cepi began collecting data.

The sector maintains a strong trade surplus, positioning it among the leading manufacturing industries in Europe by this measure. However, this second consecutive year of decline may signal a potential erosion of global competitiveness for Europe's pulp and paper industry.

In another notable achievement across industrial sectors, the efforts to reduce CO2 emissions from pulp and paper production have continued steadily, with a decrease of 5.8% in 2023. The sector has already achieved a significant 46% reduction in carbon emissions since 2005. Despite ongoing challenges, investments in this area remain substantial, yet they will need to accelerate to meet the ambitious decarbonization targets set by the European Commission.

Preliminary company data indicates a potential resurgence in production and profitability across all segments of the European pulp and paper industry in 2024. However, the industry's overall position still lags behind pre-Covid and pre-war levels in Ukraine.

See full report: KEY STATISTICS 2023 European pulp & paper industry

Source: Cepi