Rocketing Costs, Dwindling Output Wiping Out Toilet Hygiene, Warns Finnish Paper Giant

The energy crisis, coupled with soaring inflation that has hit numerous industries, has been blamed on a combination of self-crippling sanctions imposed by the EU against Russia and its energy sector over the conflict in Ukraine, as well as a drought of unprecedented severity across the continent.

Rising energy prices have forced Finnish paper giant Metsä Tissue to cut back on production levels in recent weeks, the company said in a statement.

This measure could affect the availability of tissue paper products, such as toilet paper, the press release noted, admitting the likelihood of further suspensions.

Earlier this year, Metsä Tissue, which has a total of nine paper mills across Europe and sells its products under a variety of brand names, announced temporary halts in production at plants in Germany and Slovakia, noting that the situation has deteriorated further since then.

As of now, soaring production costs are hampering operations in all of Metsä Tissue's European markets, the company's Nordic Market Director Jani Sillanpää said, adding that the situation in central and eastern Europe is particularly alarming.

“Electricity prices are historically high. The situation has been a little better here in the Nordic countries, but the price of electricity has started to rise here too,” Sillanpää said in a statement, adding that the production stoppages are having a sharp impact on the production of toilet paper and kitchen paper. “There is a risk that there will be problems with paper volumes, if this situation continues,” he added.

The rising cost of production may also affect toilet and kitchen paper, forcing prices to rise further, Sillanpää warned.

Metsä Group is a major Finnish forest industry group present in about 30 countries and employing some 9 500 people. Its core businesses are tissue and cooking papers (Metsä Tissue), cardboard (Metsä Board), pulp (Metsä Fibre), wood products (Metsä Wood) as well as wood trade and forestry services (Metsä Forest). Its sales in 2021 totaled 6Bln euros ($5.96Bln). For decades, the group has been seen as a symbol of Finnish prosperity, as the country's forest industry grew and became more internationalized.

Electricity prices in Finland have been rising since 2021, reflecting Europe's broadening energy crisis worsened by sanctions against Russian oil and gas supplies. In June 2022, the average wholesale electricity price in Finland was more than 154 percent higher than the same month a year before.

Soaring energy prices and rocketing inflation have aggravated the broadening cost-of-living crisis, hitting millions of Europeans in the pocket and prompting governments to prepare for possible shutdowns and cost-cutting measures. The crisis that has hit several industries has been attributed to a combination of self-crippling sanctions imposed by the EU against Russia over the conflict in Ukraine and an unprecedented drought.