The printing sector has long been managing supply chain pressures, but the recent surge in energy prices has introduced a new set of challenges. Additionally, a paper shortage in Europe has led to mill shutdowns and production cutbacks, putting some businesses at risk of closure. How is the industry addressing the energy crisis and navigating these other challenges?
The Supply Chain in a Precarious State
During the peak of the pandemic, production demand significantly declined, prompting manufacturers to lay off workers and scale back operations. However, as the world began to recover, the global supply chain struggled to keep up with the surge in consumer demand. This mismatch between limited supply and soaring demand has led manufacturers to raise their prices, forcing print companies to do the same. Furthermore, there have been disruptions in the supply of essential materials such as ink, paper, and other printing supplies, which have become increasingly scarce. Additionally, various socio-economic factors, including inflation, transportation issues, and labor shortages, continue to pose significant challenges to the print and paper industries.
Given the current situation, as many businesses resume operations, there is a heightened demand for print marketing materials, particularly catalogs and brochures. However, the production of these materials is hampered by a shortage of essential supplies, including cartons, banding materials, pallets, and plastic wrap. Manufacturers are facing difficulties in sourcing the raw materials needed to produce these critical items. Compounding these challenges is a shortage of transportation trucks and drivers, which negatively impacts delivery reliability, leading to inevitable delays.
The Impacts of Gas Crisis on The Pulp and Paper Industry
In the context of the ongoing energy crisis, paper has emerged as a primary concern within supply chain challenges. The rising price of paper is attributed to both its scarcity and increased transportation costs. Additionally, the pulp and paper industry faces competition for raw materials from other wood product sectors, such as construction. Despite these challenges, the demand for paper packaging is expected to continue its upward trajectory. This growth is driven by the material's ability to serve as a substitute for plastics, as well as the accelerated usage resulting from the expansion of e-commerce.
Jori Ringman, director general of the European association representing the paper industry (Cepi), confirms the significance of the paper material as well as the paper industry:
"[...] [T]he pulp and paper sector remains in the leading position for its recycling performance, use of renewable energy, energy efficiency and sustainable sourcing".
In light of the ongoing uncertainty surrounding gas and oil supplies from Russia, Cepi has called on the government for support for the paper and pulp industry. The organization has urged authorities to recognize the paper sector as a critical supplier for key European value chains, including those in the food, pharmaceuticals, and essential hygiene industries. Furthermore, there are concerns that any interventions aimed at securing supply could disrupt waste management operations and the EU-wide transport packaging value chain, which relies significantly on recycled materials. This recognition and support are crucial for ensuring the stability and sustainability of the paper industry during these challenging times.
Best Practice: European Recycled Paper Leader Steinbeis Papier
Steinbeis Papier has established itself as a pioneer in the recycling industry since launching its factory to recycle used telephone books in Germany in the 1970s. Today, it stands as a European market leader, recognized for its innovative approach to blending economic sustainability with manufacturing operations. The company has consistently focused on environmentally friendly practices, demonstrating that it is possible to achieve profitability while prioritizing sustainability. Steinbeis Papier's commitment to recycling and sustainable production methods not only contributes to the circular economy but also sets a benchmark for other companies in the industry.
Ulrich Middelberg, head of IT at Steinbeis Papier, unveils the success behind the company’s circular production despite the gas crisis:
"We are producing recycled paper economically and sustainably. At our site in Glückstadt, our own power plant provides 100% of the thermal energy and 50% of electrical energy. Now with rising energy costs, it’s a real market differentiator for us."
Steinbeis Papier exemplifies sustainability in the paper manufacturing industry by utilizing alternative fuel sources to generate energy for its plant, which produces approximately 300,000 metric tons of various paper types, including printing, copying, offset, digital printing, and label papers annually. In addition to its commitment to sustainable energy, the company recognizes the importance of digitalization in reducing raw material consumption. By leveraging digital tools and key performance indicators (KPIs), Steinbeis Papier effectively monitors its material usage, enabling proactive measures when consumption exceeds established thresholds. This approach not only enhances operational efficiency but also reinforces the role of recycling as a fundamental component of the circular economy, paving the way for a more sustainable future.
