Despite a high activity during containment (90% of activity maintained), the paper industry sector represented by the French Union of the Paper, Cardboard, Paper and Cellulose Industries (Copacel) fears that the situation may deteriorate in the coming months due to a sharp contraction in demand.
This decrease in demand for cellulose products would result in an imbalance between the demand for paper and board and the supply, which would be structurally oversupplied. This would lead to lower prices for many families of paper and board.
"The second consequence will be lower paper machine load rates, which, in a capital-intensive, 'continuous fire' industry, leads to higher costs." explains the trade union. "When we have 10 or 30% less activity, we can't cut our costs by 10 or 30%, because what weighs most in our business is fixed costs" says Philippe d'Adhémar, President of Copacel.
"Despite prudent policies, there is a concern that the persistence over a long period of time of deteriorated market conditions could weaken firms whose costs will be too high in relation to the price levels that will be observed on the markets"
In order to prevent these future difficulties, the union has formulated a six-pronged support plan. It hopes that the Minister of the Economy and Finance will take them into account in the recovery plan due to be presented in September.
The plan has two components, one on ecological transition and the other on strengthening competitiveness:
- Copacel's three measures for the ecological transition of the paper industry
- How can the competitiveness of the paper industry be strengthened?
