SOFIDEL: The Making of a Tissue Industry Giant
TISSUE360°: SOFIDEL HAS SEEN PHENOMENAL GROWTH IN THE US. CAN YOU GIVE AS AN UPDATE ON YOUR US OPERATIONS AS THEY ARE NOW?
Lazzareschi: Sofidel continues to focus on strategic growth in North America. Recently, we finalized the acquisition of the assets of Royal Paper, creating Sofidel Royal, LLC.
With this acquisition, four new facilities are now part of Sofidel America’s production footprint: three in Arizona—the Gila Bend paper mill (with an annual production capacity of 61,000 metric tons) and two converting facilities in Phoenix—and one in South Carolina—the converting facility in Duncan.
This move will further strengthen our ability to meet customer needs with a strong presence in the Western United States and lay even stronger foundations for continued growth.
Sofidel now operates a total of 14 facilities across the United States, a market that already accounts for 50 percent of our group’s total revenue and one where we expect significant growth, particularly in the rapidly expanding private label segment. At the moment, our production capacity in the United States is 813,000 metric tons per year. An additional 70,000 metric tons will be added with the third paper machine in Circleville, OH, which is scheduled to start up by the end of August. At that point, our U.S. production capacity will reach 883,000 metric tons and the group’s overall capacity will be 1,983,000 metric tons per year.
COULD YOU PROVIDE AN UPDATE ON THE PROGRESS OF THESE OPERATIONS AND THEIR CURRENT STAGES WITHIN THE SOFIDEL STRATEGY?
Our main focus right now is integrating the new facilities. I’m referring to both the former Clearwater facilities and the former Royal Paper facilities. As our previous experience in Europe has taught us, this process is never simple, and we can never take anything for granted. We need to stay alert and move carefully, step by step. What’s certain, however, is that we can rely on the strong expertise and professionalism of our new American colleagues, who are working with great dedication and commitment. Their backing is something we truly value.
ANY MORE PROPOSED ACQUISITIONS OR GREENFIELD INVESTMENTS IN THE NEAR FUTURE?
Sofidel isn’t resting on past achievements; we will continue to evaluate market and customer opportunities as we move forward. That commitment applies not only to the US, but also to Europe.
ANY CHALLENGES FOR THE US OPERATIONS IN TERMS OF TARIFFS? ANY OTHER CHALLENGES WITH SUCH FAST GROWTH IN THE US?
Since January 2025 there has been much confusion generated by the impact and uncertainty of tariffs on both imported finished goods—for example, I’m thinking of a lot of industry technology that’s produced outside the United States—and raw materials.
This uncertainty has had a significant impact. As for relations with Europe, the agreement reached at the end of July between the United States and the European Union is likely an acceptable compromise, and I hope it also helps protect end consumers from significant price increases. However, I believe it is not enough to eliminate the current climate of uncertainty.
As for other potential challenges we need to face, I see two in particular. I’ve already mentioned the first: the integration process. Another key challenge is growth: it brings risks along with it. Becoming the 4th largest manufacturer in North America means that our competitors will spend more attention monitoring Sofidel. Growth isn’t just about increasing production capacity and revenue, it also means greater responsibility. As the scale increases, so do the responsibilities.
DO YOU STILL SEE THE US AS A LAND OF OPPORTUNITY?
Yes, absolutely. In the United States, we’ve encountered a very business-friendly environment. Public institutions and local communities have consistently shown a strong spirit of cooperation, which has supported our efforts and encouraged us to invest approximately $1.7 billion in a bit more than a year and a half.
WHAT ARE THE MAIN PRODUCTS YOU ARE SUPPLYING TO THE US MARKET AND HOW DO YOU SEE THE FUTURE IN TERMS OF MARKET DYNAMICS FOR VARIOUS PRODUCTS?
Overall, Sofidel America has experienced continued growth in the first half of 2025, driven by the at-home segment where we hold a significant share of private label, and we expect to continue growing, also considering that Sofidel America is currently the only private label manufacturer that can produce using the five different paper tissue technologies: conventional, recycled, brown, TAD and NTT. This capability allows us to work with our customers offering a full range of products. That said, we believe maintaining a balanced presence across market segments is essential for long-term performance. For this reason, Sofidel is continuing its strategy to strengthen its position in both the private label and away-from-home markets, where our share remains relatively modest.
CAN YOU TALK ABOUT SUSTAINABILITY FACTORS AND OPPORTUNITIES IN THE US?
Even though there may be different perspectives and regulatory approaches on the two sides of the Atlantic regarding the urgency of addressing the ecological transition, the paper industry is energy-intensive, and even given the instability of the global scenario, the energy transition is not just an option, it’s a necessity. In Europe we are implementing a multi-option strategy that, with realism and pragmatism, aims to adapt to the technological, regulatory, infrastructural, and climate conditions of the countries where we operate. We’re starting to do something similar in the US as well. For example, on the roof of the building we recently constructed in Circleville, OH, we’re installing a photovoltaic system. Along with having high-performing production assets and locating our facilities close to our markets to reduce transportation needs, sustainability remains a key strategic asset for improving our performance.
Europe
CAN YOU GIVE US AN OVERALL VIEW ON EUROPEAN OPERATIONS, INVESTMENTS, EXPANSIONS, AND ANY PARTICULAR CHALLENGES BEING FACED?
Europe is a more stable market, where our primary goal is to consolidate our positions. Unlike in North America, we also have a strong presence in the at-home branded segment, with well-established names such as—just to name a few—Regina, Hakle, Softis, and Nalys. In this context, we are focusing on product innovation, which has become increasingly challenging due to the ongoing expansion of the retailer’s brands.
TELL US ABOUT SUSTAINABILITY FACTORS IN YOUR EUROPEAN OPERATIONS? ANY MAJOR CHALLENGES WITH ENERGY OR RAW MATERIAL SUPPLY?
Across Europe, we’re implementing a range of initiatives, including several focused on installing photovoltaic systems to generate renewable energy directly at our facilities.
These projects are underway in locations such as Kisa (Sweden), Roanne (France), Arneburg (Germany), and Călăraşi (Romania), with a similar project also being developed in Italy. In addition, we are advancing two major biomass energy projects, one in Frouard, France, and another in Baglan, UK.
In the UK I’d also like to highlight our involvement in East Midlands Hydrogen, an industrial partnership which includes 44 entities, including producers, distributors, and users that works to accelerate development and attract investments aimed at using hydrogen. All of these efforts reflect Sofidel’s strong commitment to achieving Net Zero by 2050. More initiatives are on the way. Of course, we must not forget responsible procurement, with the goal of sourcing 100 percent of our pulp from FSC or PEFC certified sources.
CAN YOU TALK ABOUT PRODUCT TRENDS AND FUTURE POSSIBILITIES IN EUROPE?
In Europe, inflation is trending downward, but in many countries, household purchasing power has not improved and consumer spending is being affected. Since the beginning of 2025, we’ve seen a slight slowdown in the toilet paper and paper towel markets, particularly in branded products compared to private label.
Despite this, the Regina brand continues to grow, strengthening its position as the second largest in the European market. Another positive sign comes from the Softis brand, which has taken the lead in the Austrian toilet paper market. This success has also been supported by the introduction of our innovative “Infinity” format, a large multipack designed to meet the growing demand for bigger packages with strong value for money. This format can hold up to 72 rolls of toilet paper. For example, in France, we launched it under the Le Trèfle brand; in Italy, we introduced a 30-roll pack of Rotoloni Regina; and in the UK, we used it for Regina Blitz paper towels. It has performed well across all markets.
Among our marketing initiatives in Europe, I’d also like to highlight a particularly significant one: our official entry into the world of sports as an official sponsor of the Giro d’Italia for the 2025 and 2026 editions. The Giro d’Italia is one of the most prestigious stage races in professional cycling worldwide, broadcast in nearly 200 countries and followed by 700 million TV viewers. This has also helped boost brand awareness across other European countries. As for the away-from-home sector, where we had our best results ever in Europe in 2024, in the first half of this year market demand was fairly weak due to low out-of-home consumption.
Technology
HOW DOES DIGITALIZATION AND AI FEATURE IN SOFIDEL’S OPERATIONS?
The digital transformation at Sofidel began in production many years ago. The Sofidel Supervision System, our Manufacturing Execution System (MES), monitors the production process in the converting departments both at the production site level and at a global level with an overview of all Sofidel Group’s Manufacturing Plants.
Concerning product quality, we are already using automatic systems based on digital solutions. Artificial Intelligence vision cameras support the continuous control of finished products and enhance the production process to guarantee the maximum performance of our products. We’ve also invested in automated warehouses at our facilities in Ciechanów, Poland, and Kisa, Sweden, as well as in Circleville, Ohio, in the United States. Additionally, we’re constructing a new automated warehouse in Duluth, Minnesota, as part of a broader production expansion project that will add converting lines to the existing paper mill.
In this context, it’s worth highlighting that Sofidel was also one of the first companies in the tissue industry to embrace online commerce. Today, approximately eight percent of our total consumer sales in Europe come from the e-commerce channel, which continues to show strong year-over-year growth.
We’re also placing a strong focus on data analysis. The powerful computing capabilities available today allow us to invest in what’s known as “software-based sensing,” sensors that don’t directly measure a variable, but instead determine it indirectly using algorithms that process a range of other physical measurements. It’s an interesting field that can significantly enhance both product quality and plant efficiency.
ANY PLANS FOR INSTALLING NEW TECHNOLOGY INTO YOUR TISSUE MILLS IN THE US OR EUROPE IN THE NEAR FUTURE?
Sofidel has always invested with the goal of adopting the most advanced technologies, often even testing emerging ones still in development. Today, however, making medium- to long-term investments in technology has become more challenging, largely due to the real risk of rapid obsolescence. The pace at which new technologies mature makes it increasingly difficult to ensure that investments remain relevant over time.
IS THERE ANYTHING YOU CAN SAY TO SUPPLIERS ABOUT WHAT TISSUE MILLS NEED IN THE FUTURE WHEN IT COMES TO NEW TECHNOLOGIES?
Yes, I suppose it’s a kind of … wishful thinking: having access to technologies that keep improving in product quality and environmental impact, while using less and less energy. But I believe that, for them, this is nothing new.
HOW DO YOU SEE SOFIDEL AND ITS GLOBAL PRESENCE IN 10 YEARS’ TIME?
These days, it’s hard to predict what might happen next month, so trying to imagine the next 10 years feels almost impossible.
I’m reminded of a quote from Pope Francis: “This is not merely an era of change, but a change of era.” And that’s exactly what we’re experiencing.
In times like these, it’s common to hear the phrase, “Let’s wait and see.” But that’s not how Sofidel operates. It’s simply not in our DNA. Even in a world marked by uncertainty and complexity, standing still is not an option. We must have the clarity and courage to move forward.
That’s why I believe the companies that endure are those best prepared to understand and adapt to transformation. I can’t say where we’ll be in 10 years. But I do know this: the future is always shaped by what we do in the present.
