Quarterly Report – January 2021

The entire world has been affected by the COVID-19 pandemic. In Turkey, some sectors have been hit hard but others to a lesser extent, with the recovered paper industry falling into the latter category. From March 2020, tissue paper producers followed by fluting and liner mills started to work at full capacity, and this is still the case.

Domestic collection rates are falling owing to COVID restrictions, which has implied an increase in imports; indeed, those mills with insufficient recovered paper stocks are importing on a regular basis. The depreciation of the Turkish lira during the third and fourth quarters of last year made imported goods more expensive, leading to an increase in domestic market prices.

Import controls were modified under a regulation issued by the Turkish government on September 3 2020. Paper mills’ imports are now limited to a maximum of 50% of their production capacity as compared to the historic average of 80%, leading to a major backlash across the industry.

The Balikesir Varaka paper mill started operating in 2020 and has increased annual demand by 400,000 tonnes while the Kipas Soke mill, scheduled to become active by the end of this year’s first quarter, will add a further 800,000 tonnes to the demand total. Taking into consideration all the capacity expansion investments, domestic demand in 2021 is projected to be around 5.3 million tonnes. Once the Kutahya Hamburger facility starts up in 2022, this figure is expected to increase by around 17% to 6.2 million tonnes.

In 2019, a domestic recovered supply of 2.2 million tonnes was supplemented by imports of 1.2 million tonnes to give a total of 3.4 million tonnes. Although exact figures for the final month of 2020 are not yet available, domestic collections up to December were around 2.7 million tonnes and imports some 1.5 million tonnes for a recovered paper supply total of 4.2 million tonnes.

On January 4 this year, it was announced that Mondi had signed a pre-contract agreement to acquire Olmuksan’s corrugated box mills located in four different regions.

Ekrem Demircioglu - Ekrem Demircioglu (Turkey)

Ekrem Demircioglu


Quarterly Report – January 2021