The global market for retail tissue and hygiene has reached a greater level of stability than had been the case earlier in the pandemic. While volatility exists with countries still responding to waves of the virus, related to hemispheres, the appearance of new variants and the success (or otherwise) of domestic policies. Outside the pandemic, China’s move to a three-child policy is the biggest news event for the industry, focusing coverage in this report to our initial response and analysis.
As expected, Q4 2021 is still a story of pandemic as the world moves through the multiple and evolving challenges presented. Although tissue and hygiene possess a great amount of commonality, both markets present significantly different responses to the circumstances evident in this quarter; tissue still digesting a glut of consumption in 2020, while hygiene is heavily impacted by demographic factors.
Q4 2021 can be viewed as a positive, if marginal, improvement on the baseline for the tissue market as it showed growth outlook improvement through to 2025, while the hygiene market is showing a slight decrease compared to the baseline but still remaining in positive growth territory. Once again, the pandemic has much to do with this change in outlook; immunisation, although favouring the developed world, continues to have its impact as well as government economic intervention which suggests the worst of job losses and recession continue to be mitigated, at least for now. Demographic factors also continue to play a big role, leading to a lesser outlook for big markets in hygiene which affects the outlook for the industry overall.
As the COP26 conference is being held in Glasgow, the sustainability perspective is high on the agenda in most industries and so is the case for tissue and hygiene as well. Regulation on a cross-national level, along with the will of consumers, is likely to change the market environment, not by choice but more out of necessity. Product formats are likely to change in order to meet more stringent waste priorities and circular economy mindsets, likely leading to new business models in the coming years.
As we move closer to a post-pandemic new normal situation, products that are tied to demographics, eg baby care products, most notably nappies/diapers, in our story will need to continue to evaluate options for growth. What options are there to expand usage occasions, and premiumise within the confines of income reality? With a view on the longer-term demographic, disruption now will come with economic fallout from the pandemic, meaning that for many industries navigating this path will be a necessity.
This is the aggregation of retail and away-from home tissue and disposable hygiene products as well as Rx/reimbursement adult incontinence.
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