Navigating uncertainty in the 2020s: the past, present and future of North American tissue

With world trade predicted to continue to face many challenges throughout the decade, adaptability is the key to meeting the changing demands of tissue producers and consumers.

Authored by AFRY Management Consulting’s Brigit Kaila, Patricia Marques and Sanna Sosa.

The North American tissue market, historically stable and closely linked to population growth, has faced unprecedented uncertainty this decade. The first half saw major turbulence driven by the COVID-19 pandemic, with lingering effects such as shifted consumer behaviour and a new hybrid work norm continuing to shape demand in 2025.

Looking ahead, the market remains in flux, influenced by the uncertainty of Return-to-Office (RTO) mandates, economic unpredictability, new immigration policies, pending tariffs, and significant shifts among key market players.

The past: pandemic aftershock

The 2020s kicked off in an unexpected fashion for North American tissue. A market considered stable in the previous decade — growing a predictable 1-2% per year and tightly correlated to North American population growth — was suddenly shocked by the panic-purchasing and public closures of the COVID-19 pandemic in 2020. Total tissue demand spiked, and the market shifted heavily toward At-Home tissue consumption by over 6% that same year (Figure 1. North American At-Home versus AfH tissue demand).

The following year was not less turbulent, with tissue destocking across consumers and retailers reducing overall tissue demand and swinging consumption back towards AfH tissue consumption as public spaces reopened. From 2022 to 2023, the market slowly stabilised and RTO mandates emerged, but AfH tissue did not achieve the same slice of the North American tissue market that it had achieved pre-pandemic (Figure 1) — hybrid and remote work became the new norm, and US office vacancies had stabilised at around 20% in 2023/2024, according to the financial services firm Moody’s.

In 2024, At-Home tissue saw its first near-flat year-on-year growth since pre-pandemic dynamics, after a slight decline the two years prior. With RTO trends settled at an average of two to three days mandated in-office per week, the readjustment of At-Home tissue demand saw a step-change of around a quarter-million metric tons above 2019 demand levels. The fluctuation of RTO trends, as well as pandemic-led shifts in consumer behaviour, continue to influence tissue purchasing today.

A new era of tissue consumption

Aside from the drastic peaks and valleys that the pandemic created within At-Home and AfH tissue markets, COVID-19 had more subtle effects on consumer behaviour and purchasing trends. The shifts have been quiet but lasting, including increased hand washing and drying practices and a surge in disinfecting nonwoven substitutes. According to the 2025 Healthy Handwashing Survey by Bradley Company, 79% of Americans say they have been more diligent about hand washing since the coronavirus outbreak — an equal percentage also report washing their hands more frequently during seasonal virus outbreaks.

Away from the home, public practices that boast the importance of hygiene are expected to persist in 2025 and beyond, as infectious diseases such as H5N1 bird flu, measles and others continue to cause public concern. At home, many consumers switched from paper towels to disinfecting nonwoven wipes during the COVID-19 pandemic, a peak witnessed in the performance of key wipes players such as Clorox, as product demand rose 500%. While that substitution trend has since curbed, it is possible that another demand swell could arise.

Beyond the predictable rise in consumer concern for hygiene, the COVID-19 pandemic has led to several unforeseen tissue consumption preferences. The shift towards bulk pack purchases, a trend already in motion pre-pandemic, was accelerated and saturated as panic buying began in 2020 — and it has lasted long beyond the days of lockdowns. The majority of AFRY consumer survey respondents report that they started buying larger pack sizes during COVID-19 and have continued the habit post-pandemic. Both retail and e-commerce sales channels have witnessed lasting bulk purchasing trends across various sectors, from toiletries to groceries.

The purchasing of bulk packs is especially favoured in e-commerce sales channels, which also saw a sizable boost in popularity during the pandemic. From 2019 to 2020, the e-commerce share of total global retail sales was boosted by over 4% points according to the U.S. Department of Commerce; compare this to an average share increase of just 1.6% per year since 2015. According to a 2024 Mintel report, younger generations are making most of their purchases online: 58% of millennials, 56% of Gen Z adults and 60% of Gen Z teens. As Generation Z ages into the workforce, they are expected to continue the shift toward online purchasing that was once bolstered by pandemic-related closures.

Moving forward among moving pieces

Forecasting for the upcoming half-decade has become increasingly complex. Evolving RTO mandates, US immigration policies, and possible tariffs are only a few of the evolving variables that might cause us to philosophise the future of tissue. As demand models become more flexible to account for such moving pieces, the macroeconomic outlook becomes more rigid in view.

The same economic uncertainty that has marred the early 2020s is expected to continue throughout the decade, according to the International Monetary Fund, with possible economic disruptors including global issues of climate change, geopolitical fragmentation, digitalisation, and increasing artificial intelligence (AI) usage. A focus on adaptability when predicting global markets, including the North American tissue sector, has become of high importance.

Economic uncertainty, price sensitivity and private-label tissue

The early 2020s bore witness to a global pandemic, supply chain disruptions, geopolitical conflict, rising prices — and tissue shortages. Consumer confidence waned and price sensitivity soared, with lowest-cost options magnified in desirability.

In 2025, Forrester predicted that price sensitivity will lead to a 25% decline in brand loyalty. This contracting-brand-loyalty trend has been observed in tissue products since 2020, with demand for private-label tissue products gaining a market share of four percentage points from 2020 to 2024 (Figure 2. North American branded versus private-label tissue market share). If uncertain economic conditions continue, private-label products are expected to gain share from branded options throughout the latter half of the decade. High price sensitivity continues to be a key driver in the push for private-label products.

RTO as a question mark

The future of in-office work remains an unknown variable for the projection of At-Home and AfH tissue demand. Some large companies have pushed for a full return-to-office, most notably Amazon in 2025 with 350,000 corporate employees, while others seem content with offering a hybrid or remote work model to employees.

Financial industries like banking have seen a strong push to in-office work, while many smaller businesses allow higher flexibility. If current office policies have reached the new equilibrium, then the step change of At-Home tissue demand may be permanent. Otherwise, AfH demand may increase or decrease depending on office occupancy rates to come — with an estimated market share gain of about 2% at stake.

Immigration policies: crippling a critical tissue driver

The prevailing demand driver for North American tissue consumption is North American population growth. The more people there are living in a region, the more tissue will be used. Despite boosts from strong tourism years — and threats from bidets, reusable towels, and nonwovens — pre-pandemic tissue demand remained steadfast and highly correlated with the stable growth of the North American population.

Historically, that population growth has been steady at around 0.7% per year, according to data from the US Census Bureau, but since 2020, that growth has slowed to only about 0.5% per year. Going forward, the Congressional Budget Office predicts that the US population will grow at only 0.4% per year through the end of the decade, with most of this growth driven by an important dynamic: immigration.

Between 2023 and 2024, net international migration accounted for 84% of US population growth as reported by the US Census Bureau. Of the total immigrant pool, it is estimated that about 23% are unauthorised immigrants, according to the Pew Research Center. Unauthorised immigrants are an estimated 10-11% of the population. Tightened immigration policies and deportation efforts announced by the Trump administration have the potential to slow — or even reverse — US population growth.

The quantitative effects of these new policies are yet to be determined, but they could bring changes that affect tissue consumption in the years ahead. More acutely, other evolving Trump administration policies may significantly impact the dynamics of North American tissue on the supplier side, from supply chains to market strategies and beyond.

Tissue supply chain challenges and potential tariff increases

A few weeks after the inauguration day, President Trump declared 25% tariffs on all imported goods from Canada and Mexico and a 10% tariff on goods coming from China. Subsequently, Trump agreed to a 30-day pause on his tariff threats against Mexico and Canada, as the two countries took measures towards border security and drug trafficking into the US. This temporary pause provided some relief to stakeholders in the tissue industry, however, if these tariffs are implemented, it could hurt supply chains and negatively impact consumer prices of tissue products in the US.

Canadian softwood pulp is the main raw material in tissue production. Increased tariffs on imported Canadian pulp will hurt local tissue producers’ cost structure, considering import tariffs are typically paid by importers. US tissue manufacturers may explore the viability of other sources, including Nordic mills, to furnish changes such as adding more hardwood like eucalyptus pulp and alternative fibres.

The total import volume of tissue products from Canada and Mexico combined is estimated at 600,000 tpy (equivalent to 10 large tissue machines). This accounts for parent rolls that are brought in to be converted in the US and finished tissue products such as bath tissue, towels, napkins and facial tissue that we see on the shelves of retailers.

In a 25% tariff scenario, US tissue mills that operate tissue machines in Canada or Mexico may consider shifting production to the US. However, this transition could face several challenges, including the need for capital investment and high pulp costs in the US.

On the other hand, tissue companies with operations on both sides of the Atlantic, such as Essity and Sofidel, could capitalise on the opportunity to redirect European production to the US in response to potential volume gaps caused by the new tariffs against Canadian and Mexican products. Implementing this strategy may be hindered by tissue buyers’ reluctance to accelerate the shift in sourcing, and further, by the possibility of additional tariffs being implemented on European goods entering the US.

Unstoppable force: growth of the mid-size tissue players

Especially under the protectionist trade policies, domestic US tissue capacity investments are guaranteed to continue. On average, two new tissue machines have been added to the North American market in recent years.

In 2024, Georgia-Pacific started a new TAD machine and three converting lines to support its own branded and private label towel business at its mill in Green Bay, WI, and Kruger expanded its footprint at Sherbrooke, QC, by completing the construction of a new light dry crepe (LDC) machine and converting lines.

Last year was a welcome growth to the recent wave of tissue mill closures. Based on the AFRY Smart tissue capacity tracker, close to 800,000 short tons of tissue manufacturing capacity was closed in North America between 2020 and 2023. Many of the closures were small, ageing, and AfH-focused tissue machines. The most notable tissue machine closure in 2024 was the permanent closure of Soundview’s Putney mill early in the year.

Despite the new supply coming online and an absence of closures, the industry reported healthy operating conditions, and high operating rates invited several new tissue project announcements in late 2024.

First Quality Tissue announced a commitment to install two new TAD machines and converting in Defiance, Ohio. Irving Tissue confirmed another $600m expansion, including a third TAD machine and converting operations at the Macon, GA, complex, which was started just in 2018. At the time of the expansion announcement, Irving was to continue supplying pulp to Macon from its pulp mill in Saint John, NB — pending tariffs proposed by President Trump may injure this strategy.

The industry capacity growth pipeline looks robust and aligned with expected overall demand growth, with half a dozen new tissue machines announced to be built over the next few years, and a few more expected or speculated. (Figure 3. New tissue capacity pipeline map).

Capacity growth by mid-size tissue manufacturers continues to shape the North American tissue supply landscape whilst “the big three” continue to dominate the tissue manufacturing landscape in North America. However, a new (long awaited) dynamic is emerging on the market: M&A. (Figure 4. North American top tissue manufacturers).

Growth on mature markets: M&A

2024 was a year of significant, although singular, M&A in the North American tissue market. It is something we have not seen for years, despite the market dynamics of steady, slow growth and an industry structure of a few leading players, followed by many smaller ones being fertile ground for inorganic growth.

The year started with Sofidel acquiring ST Tissue’s newly built tissue platform in Duluth, MN, which was only a prelude to the big move of acquiring Clearwater’s tissue business in a $1.06bn deal. The acquisition included four tissue mills, of which one continues to be shared with Clearwater’s cartonboard business in Lewiston, ID.

Sofidel is the second largest tissue company in Europe, behind Essity, and now the fourth largest player in North American retail tissue with a growing footprint of seven mills and 13 current tissue machines, with another new machine coming online later in 2025. Sofidel has had a strong growth path in the US after its initial acquisition of Cellynne in 2012.

Clearwater’s acquisition created a new private label market leader, with Sofidel to captain the segment together with Georgia-Pacific. A large-scale private label supplier with a strong nationwide footprint is well-positioned to further drive private label market adoption, as well as steer positive EBITDA development for the segment overall.

It is undetermined how market dynamics and Trump administration policies will shape the North American tissue landscape in 2025. Kimberly-Clark has been exploring strategic options for its tissue business outside North America, which could pave the path for further consolidation in North America.

The disruptive decade

The late 2020s are shaping up to be just as uncertain as the former half of the decade, with tariff threats, new immigration policies and altered consumer behaviour shaking up what has been a market of dependable growth. If all proposed policies take effect, their impact on demand will be significant and complex.

On the supply side, tissue manufacturers must remain agile in this rapidly changing landscape, optimising product portfolios and fortifying supply chains to stay competitive. Navigating these challenges successfully will require a blend of strategic foresight, adaptability, and operational resilience.

This article was originally published on the Tissue World Magazine website under the name of MARKETISSUES: Navigating uncertainty in the 2020s: the past, present, and future of North American tissue on April 25, 2022.