How to navigate uncertain markets? Global tissue market prepares for a new phase

“Uncertainty” and “adaptation” are words that have defined the global tissue market in recent years, and they remain at the forefront in 2025. After a record-breaking year in demand, the industry is now preparing for a new phase of moderate but still promising growth.

During the Fastmarkets Forest Products Latin America Conference, Stephanie Hsia, economist at Fastmarkets, emphasized the importance of understanding how to navigate this evolving landscape. According to her, trends such as the expansion of e-commerce and the strengthening of the away-from-home segment are shaping new consumption habits, intensifying competition, and creating fresh opportunities.

Hsia recalled that global tissue consumption surged during the pandemic, peaking in 2020. After years of gradual recovery, 2024 set a new record with more than 47 million tons demanded worldwide.

However, projections point to a slowdown: while global growth averaged 3% annually over the past five years, the forecast through 2029 is 2.1% per year — a slower pace, yet still underpinned by urbanization, digitalization, and heightened hygiene awareness.

NEW FRONTS FOR GROWTH

The institutional, or away-from-home, segment has not yet regained pre-pandemic levels in Latin America, remaining below the global average. This gap represents a significant space for expansion.

“North America is the benchmark in away-from-home production consumption, with one-third of its demand focused entirely on this segment. In Latin America, however, it stands at just 18%, compared to around 20% and 21% before the pandemic. So, there is still much room for growth and for recovering sales and volumes”, Hsia noted.

In Latin America, the tissue market remains centered on toilet paper and paper towels, leaving room for expansion in facial tissues, napkins and other categories. “Is there an opportunity for these other markets to grow? Yes, there is. With the growth of the personal care segment, for instance, we can strongly support the use of facial tissues, but also other sanitary products. The expectation is that this segment will continue growing 7% annually worldwide over the next five years”, Stephanie explained, adding that South America alone could see growth of 6%.

Products such as diapers and feminine hygiene pads also show growth potential, as they are higher-value items that can boost company revenues. Meanwhile, the napkin segment, driven by food service, is expected to advance robustly, particularly in the Americas and Asia.

E-COMMERCE: THE NEW SALES CHANNEL

In China, more than half of tissue sales already occur online, with platforms driving trends and offering innovative models such as group purchases and live-streaming commerce.

Latin America, led by Brazil and Mexico, ranks second in e-commerce growth, fueled by rising household income, increased transaction security, and lower shipping costs.

While Europe emphasizes price comparison and sustainable packaging, the U.S. market stands out for its subscription models, largely dominated by private-label products offered by major platforms.

EXPANDING PRODUCTION CAPACITY

Brazil and Mexico lead industrial expansion in Latin America, with projections of an additional half a million tons between 2026 and 2027 — exceeding expected demand growth and opening room for exports.

Brazil exported 100,000 tons in 2024, nearly 70% of which were jumbo rolls, while Mexico remains focused on finished products destined for North America.

“Mexico has increased its capacity, but tissue exports have decreased, and jumbo rolls represent a smaller share of that volume”, Hsia stated. “And the main destinations? North America: Canada and the United States”, she added.

COMPETITIVENESS AT STAKE

Technological advancements have reduced the perceived difference between products made with virgin and recycled fibers, boosting global acceptance of Latin American and Asian manufacturers.

The current challenge lies in balancing cost pass-through to consumers while protecting margins in a highly competitive price environment. This scenario is driving strategies such as portfolio diversification and prioritization of higher-value products.

OUTLOOK FOR THE COMING YEARS

Global demand will remain tied to economic and population growth, but will also be reinforced by urbanization, digitalization, and increased concern with hygiene.

In Latin America and the Middle East, the institutional segment is expected to be a key driver of recovery, while in Asia, production flexibility will allow companies to expand their product mix and serve multiple niches.

In an increasingly integrated global industry, those who succeed in aligning innovation, competitiveness, and logistics will gain the upper hand in the race for tissue.