Exclusive outtakes from industry leaders
When it comes to hygiene, Hannu Kottonen is one executive who practices what he preaches. As the man who heads Metsa Tissue, a company that produces products ranging from tissues to toilet paper, he knows a thing or two about how germs spread. So when he visited the Thomson Reuters office in Helsinki to take part in the annual Reuters Paper and Packaging Summit, perhaps we should not have been surprised when he declined to shake the hands ot the various journalists assembled there.
We didn’t take it personally and Kottonen explained that hygiene was an issue that had not been given due attention. But some of that seems to be changing. Metsa Tissue is seeing more demand for some hygiene-related products as a result of the H1N1 flu outbreak and all the attention on hygiene it had generated. And it’s not the only such company. Another Finnish specialty paper producer, Ahlstrom Corp, reported a similar trend, with more demand for the material that goes into face masks and for sanitary wipes.
The global paper industry has struggled for more than six years to claw its way out of a slump, as soft demand and overcapacity have kept prices down, leading to poor earnings, production curtailments and layoffs.
The current global downturn has further eroded demand for basic materials, including paper, as print advertising has dropped steeply in the crisis. Companies have been forced to run just to stand still, temporarily or permanently shutting mills and axing staff.
Overcapacity has kept a lid on paper prices for years, while increasing costs of wood and energy have eaten into the paper makers’ already low margins.
Combining paper and packaging production may seem like the obvious union, but head of Finnish packaging maker Huhtamaki said it proved time and again to be a money loser and his company will not go that route.
Huhtamaki manufactures a wide array of food and beverage packaging and other packages for industry. It buys raw materials from forestry companies and converts them into packages.
Chief Executive Jukka Moisio told a Reuters Paper Industry Summit in Helsinki that packaging a product actually reduces the amount of waste used rather than creating it.
The current slew of bad news was necessary to get European forestry companies to act, the head of the world’s top paper and board maker Stora Enso said on Wednesday.
For years the European paper industry has suffered from overcapacity, which has kept a lid on prices, while increasing costs of wood and energy have eaten into already low margins.