Mondi invests in corrugated packaging production as FMCG, e-commerce and industrial demand grows
25 Mar 2022 --- Mondi is investing €280 million (US$309 million) in corrugated packaging operations across four countries to boost production and serve customers more efficiently.
The investment includes around €185 million (US$204 million) across its central and eastern European Corrugated Solutions plant network and €95 million (US$105 million) at Mondi Świecie’s containerboard mill in Poland.
The paper and packaging supplier says these investments represent an important part of its €1 billion (US$1.1 billion) in expansionary capital investment projects this year to accelerate growth in environmentally sustainable packaging.
Corrugated packaging demand
Mondi expects European demand for corrugated packaging to grow by 2-4% per year in the medium term as customers increasingly. It is investing in its ability to supply the growing FMCG, e-commerce, and industrial markets from resource-efficient plants and equipment.
Recently, the company has helped customers switch to heavy-duty corrugated packaging, bolstered by its recent acquisition of Turkish plants.
In February, it agreed to sell its Personal Care Components business to focus on its paper and packaging businesses.
The investment program
The new investments will include the upgrade of the Świecie’s containerboard mill, comprising an extensive rebuild of paper machines PM2 and PM5 and a new anaerobic treatment plant, including an integrated cooling system. It will also include upgrades to the pulp mill, the recycled fiber line and the energy recovery system.
These improvements will allow the mill to meet growing customer demand for heavy-duty applications, enhance product quality, and bolster its environmental performance by decreasing water consumption and wastewater emissions while increasing energy efficiency.
Mondi is helping customers switch to heavy-duty corrugated packaging, bolstered by its recent acquisition of Turkish plants, allowing it to serve a broader range of industries and geographies.
Meanwhile, the plant at Mondi Warsaw will more than double in size and capacity and receive new machinery and automation, including a corrugator of an industry-leading 3.35 meters in width.
The investment will also include expanded corrugated solutions production for the e-commerce market, with modernization and improvements across eight sites located in Poland (Simet, Świecie, Warsaw, Dorohusk, Szczecin, Bystrzyca), Germany (Eschenbach), and the Czech Republic (Bupak), and a comprehensive upgrade of Mondi Simet to erect a warehouse for finished goods storage and automate internal material flows.
Turkish focus
Moreover, investments in operations in Turkey focused on the newly-acquired Mondi Olmuksan plants, with Gebze specializing in e-commerce packaging production and Bursa reinforcing its heavy-duty output with the addition of sheet production.
Furthermore, the Izmir site will be transformed by a comprehensive modernization and expansion program, enabling a leap in output and efficiency, plus further refinement in quality assurance for customers. Mondi Tire Kutsan Karaman will also get a new high-quality printing casemaker.
“The investments in state-of-the-art machinery for our Mondi Olmuksan plants expand our offering to customers in the region in line with our ambition to become a leading player in the structurally attractive Turkish market,” says Armand Schoonbrood, COO for Corrugated Solutions at Mondi.
“Thanks to our overall expansion and modernization plans, we will continue to be a reliable partner meeting online retailers’ increasing demand for e-commerce packaging designed for a circular economy.”
“The latest market research on e-commerce shopping and packaging trends in Germany and Poland, commissioned by Mondi, shows that consumers of all ages continue to buy online and prefer e-commerce packaging that is [environmentally] sustainable.”
Mondi research shows consumers of all ages continue to buy online and prefer e-commerce packaging with environmental benefits.
Finnish upgrade
The expansion and upgrade of Mondi’s Kuopio semi-chemical fluting mill in Finland also remain on track. The €125 million (US$138 million) capital investment project announced last year will increase the facility’s capacity by around 55,000 tons per annum to meet growing customer demand, enhance product quality and cost-competitiveness, and strengthen the mill’s environmental performance.
The project includes upgrading the wood yard, fiber line, evaporation plant and paper machine, with start-up planned for the fourth quarter of 2023.
“[Environmental] sustainability is at the heart of Mondi’s strategy,” explains Markus Gärtner, CEO for Corrugated Packaging at Mondi. “Ongoing investment in our Corrugated Packaging business supports our MAP2030 commitments around circular-driven packaging and paper solutions, created by empowered people taking action on climate.”
“Together with our suppliers, we are further optimizing our production processes to use resources more responsibly, minimize our environmental footprint and contribute to a better world.”
“At the same time, customers benefit from enhanced product quality and shorter lead times, while our employees enjoy exciting job opportunities operating state-of-the-art machinery with world-class safety standards.”
Mondi recently presented clarifications about its continued business dealings in Russia after coming under criticism for refusing to join an industry-wide divestment from the country after the Ukraine invasion.
By Joshua Poole
