An increasing number of families with children are using disposable diapers, and the emergence of hypermarkets and superstores is now increasing the availability of these products and changing behaviour for a significant number of the country’s 140+ million residents.
Not surprisingly, major investments in new manufacturing lines for disposables have been announced recently by consumer giants including SCA and Unicharm.
Unicharm believes the value of the Russian diaper market alone will reach a value of over €1 billion by next year – 70% higher than its value in 2008.
Major international nonwovens companies with plants already in place in the country include Avgol and Freudenberg Politex, with others currently considering following suit.
The evolution of the Russian nonwovens industry has been unique to itself, and starting with intensive development in the 1970s and 80s, the manufacture of nonwoven materials dropped significantly during the country’s economic crisis of the 1990s.
The crisis which struck all post-Soviet countries for most of that decade was nearly twice as intense as the Great Depression in Western Europe and the United States in the 1930s, and even before it peaked in 1998, Russia’s GDP was half what it had been in the early 1990s.
Since entering the 21st Century, however, rising oil prices, increased foreign investment, higher domestic consumption and greater political stability have bolstered economic growth. In early 2008 the average Russian salary was $640 per month – up from $80 in 2000 – and the country’s middle class is estimated to have grown from 8 million to 60 million within the same timeframe.
Consequently, nonwovens demand – as good an indicator as any of rising affluence – started to grow and domestic production began to revive, with new investments in carded/needlepunched and polypropylene spunbond roll goods - initially for geotextile and industrial end-uses.
And while carded and needlepunched materials are still the most important production in terms of volume, over the last three years major investments have been made in polypropylene spunbond and drylaid-spunlaced lines to address the needs of the hygiene and wipes sectors.
In 2008, Russian nonwovens production was around 45,000 tonnes, but new plants opened during 2009 and several important projects are also planned to come on-stream in the near future.
“Russia has felt the effects of the global downturn and while the economy could return to modest growth in 2010, it is likely to continue to be difficult over the next year or so,” said Pierre Wiertz, General Manager of the international industry body EDANA, which is currently involved in a number of activities aimed at supporting Russia’s development. “But prospects for growth beyond that are impressive.”
EDANA is also confident that it will now attract many of the country’s leading nonwovens manufacturers to INDEX 2011, the leading nonwovens show which takes place at Geneva Palexpo in Switzerland from April 12th-15th next year.
In a report by EDANA based on official statistics, Russia has also become one of the main destinations for EU products. In 2008, 25,000 tonnes of nonwovens – representing more than 10% of EU27 roll goods exports – were sent to Russia, of which 70% were spunmelt materials.
During this same period, 103,650 tonnes of absorbent hygiene products (representing nearly one third of EU27 exports) were destined for the Russian market.
Of recent investments, SCA’s new €13 million production line for incontinence care products will allow it to make considerable cost savings in transportation costs and import duties, by decreasing the amount of the products it currently supplies to Russia from operations in Poland and Holland.
SCA first established itself in the Moscow region in 2008, when it installed production facilities for baby diapers. The new line for incontinence products will also be installed at the plant currently making diapers in the city of Veniov in the Tula district, approximately 180 km south of Moscow.
SCA already has a 20% market share of the Russian market and has also recently established a joint-venture company with Unicharm, which will begin manufacturing premium brand diapers and training pants this year.
