Europe Energy Crisis Halts Papermills Production

The skyrocketing gas prices certainly have caused damage that was felt throughout the world. The energy crisis is one of the most troubling issues Europe has had to face from late 2021 until now, in consequence of increased gas prices. The crisis makes a dent in various industries, including the paper industry.

Energy Crisis Effect on Europe Paper Industry Production Cost

As reported by Austropapier, companies with energy-intensive production are currently spending up to ten times more on electricity and gas than they did last year. The extremely high electricity process driven by the energy crisis in Europe, has forced companies to halt their production.

In early 2022, Mets? Tissue, the leading tissue paper supplier in Europe, revealed that they temporarily stopped production owing to the high electricity cost. Both the Zilina Mills (Slovakia) and Kreuzau Mills (Germany) production has stopped for several days. Further production curtailments may have to be expected and it is likely that the availability of daily tissue products in Europe can also be impacted.

While in Sweden, Lessebo Paper announced that they are forced to cease production due to the elevated electricity cost, effective on August 31. As stated by the company the electricity cost has unprecedently escalated from €3 million to €19 million per year, resulting in a daily electricity cost of more than EUR 58,000 for Lessebo Paper. CEO of Lessebo Paper said that the decision was made since the electricity price has progressively increased since autumn 2021, and there seems to be no slowdown in near future. In addition to the coming winter, which usually entails high electricity prices while Lessebo Paper already faced the concerningly high electricity price in August.

Possible Mitigation Acts

With the rising gas price that potentially not going down anytime soon, companies have to explore other options to even out the electricity cost. One solution that they can take is switching paper production to utilizing renewable energy instead of fossil fuels.

Austropapier, mention a few paper producers that implement environmentally process through renewable energy, such as waste-to-energy boiler, biomass power plant, and PV (Photovoltaic) system. Not only surmounting the electricity cost in the long run, but shifting to renewable energy also build a better image for the brand.

To support the paper industry Tradeasia International is here to provide our customers all around the world, with a variety of raw materials suitable for any industry, including coating, paint, paper, and many more. Despite the ongoing crisis caused by high oil price, Tradeasia International also strives to give customers a satisfying supply chain experience, through optimized logistic services, especially ocean freight for containerized shipments supported by Sree Logistics.

References:

Autropapier. (2022, September 7). Paper Industry Demands Real Relief on Energy Costs Retrieved from   https://austropapier.at/en/papierindustrie-fordert-echte-entlastungen-bei-energiekosten/

Paper Age. (2022, September 7). Mets? Tissue Temporarily Curtails Production at Two Mills Due to High Energy Prices. Retrieved from

https://www.paperage.com/2022news/08-31-2022metsa-tissue-high-energy-costs.html

Paper Age. (2022, September 7). Lessebo Paper Says Unprecedented High Prices for Electricity to Disrupt Production. Retrieved from

https://www.paperage.com/2022news/08-31-2022lessebo-paper-electricity-costs.html