Tag: SWM

Unwavering Commitment

Katrin Hanske | Photos courtesy of SWM international
Innovation, integrity and excellence remain at the core of SWM’s business under the company’s new ownership.
TR Staff Report
In late 2023, a relatively unknown company in the tobacco business, Evergreen Hill Enterprise, purchased the world’s leading supplier of cigarette paper, SWM International, from Mativ Holdings, which had decided that SWM’s tobacco focus would present a more attractive value proposition under new strategic ownership.
Headquartered in Singapore, Evergreen Hill Enterprise is part of an Indonesian-based privately held group of companies serving the tobacco, banking and consumer electronics industries, among other sectors. One of its affiliates is BMJ, a supplier of tobacco packaging and paper with a strong presence in Asia, but the partners made clear that SWM and BMJ would continue to operate independently.
Tobacco Reporter caught up with SWM President and CEO Katrin Hanske to learn what the deal has brought to SWM and its customers.
What have been the biggest changes in SWM’s day-to-day operations since Evergreen Hill Enterprise announced its acquisition in August 2023?
Nothing has changed because they don’t intervene in our day-to-day operations. SWM International is the same company everyone knew before. We still have the same values and culture that our customers, suppliers, partners and employees trust and appreciate. We haven’t changed from a cultural or value perspective, upholding the principles that define how we think, work and interact.
After transitioning from a publicly traded to a privately held company, we relocated our headquarters from Alpharetta to Luxembourg. This shift has granted us greater flexibility to pursue key market opportunities and streamline our strategic decision-making process.
Our priorities remain focused on our customers, unwavering commitment to innovating the industry, empowering our employees, maintaining integrity and striving for excellence in everything we do.
What steps have been taken thus far to integrate SWM into Evergreen Hill Enterprise’s operations?
The acquisition was not focused on integrating SWM but on strengthening Evergreen’s presence in the tobacco market. As a result, we do not have synergies or shared resources with Evergreen or BMJ.
Have there been any senior personnel changes in the wake of the acquisition?
The answer is no. In fact, we have retained our leadership team to ensure continuity, stability and expertise. This stability and accumulated generational knowledge allow us to create high-performance products and tailored solutions.
What advantages has the acquisition brought to SWM customers thus far? What additional benefits do you expect them to receive from the deal in the future?
Our focus is accelerating innovation to support our customers’ journey toward reduced-risk products and sustainability. We do this by optimizing the properties of botanicals, natural fibers and lightweight paper solutions. We continue to invest in innovative products and sustainability efforts along the supply chain. This directly benefits our customers, as they can expect us to remain at the forefront of innovation, committed to sustainability and with a strong presence in all geographies.
Does the backing of Evergreen Hill Enterprise enable SWM to pursue projects that it wasn’t able to pursue before? Please explain.
Clearly, we see a significant benefit now of aligned interest in being successful in the tobacco market, allowing us to pursue projects faster than before but also being strategically aligned with the agenda/requirements of our customer base. This includes our recent commitment to the SBTI [Science-Based Targets Initiative] decarbonization program,* which aims to significantly reduce the environmental impact of our operations.
Evergreen Hill Enterprise is also affiliated with BMJ in Indonesia. What do you consider to be the respective strengths of SWM and BMJ? In what respects do they complement one another? What will be the relationship between SWM and BMJ under the Evergreen Hill umbrella?
SWM International and BMJ continue to compete in the marketplace. SWM International is well positioned to support the industry’s shift to reduced-risk products, with a strong presence in the Americas and Europe. BMJ, on the other hand, has a significant foothold in Asia. As a result, looking from the outside, we complement each other with respect to our geographical presence and our product portfolio.
How have customers responded to the acquisition?
The transition to private ownership has been well received by our customers. They see the benefits of our increased focus on meeting their needs within the nicotine and tobacco industry.
What segments of the tobacco paper market will SWM prioritize going forward? Please explain.
SWM International prioritizes customer needs and aligns with their goals. In the traditional/legacy combustible segments, we emphasize performance, high quality and competitive pricing. Our innovation efforts focus on next-generation products as well as offering more sustainable solutions for our existing portfolio.

SWM’s Evolute filtering media enables tobacco companies transition to more sustainable solutions in both their combustible products and heat-non-burn offerings. | Image: SWM
Are you considering diversification into adjacent categories, given the long-term outlook for tobacco consumption—or is the acquisition an opportunity to double down on your tobacco focus? Please elaborate.
Our company’s proficiency in developing light[weight] and ultra-lightweight papers with specific functionalities extends our reach beyond the tobacco industry. We offer intelligent, sustainable, flexible packaging solutions that are free from plastic and provide barrier effects, heat-seal capability and customizable features. Additionally, our expertise in filtration characteristics presents further opportunities for innovation.
What is next for SWM in terms of manufacturing, product innovation and sustainability?
Our commitment to science-based innovation, manufacturing excellence and the ingenuity of our people drives us to continually develop more sustainable filters that meet taste and sensory expectations. Our scientists and research and development teams collaborate closely with customers to design products with reduced health and environmental impacts. Simultaneously, our operations focus on decarbonizing manufacturing, improving asset efficiency and expanding capabilities to accelerate innovation.
The industry can rely on our dedication to delivering sustainable solutions while maintaining high product quality.
September 1, 2024
SWM Deal Complete

Photo: SWM
SWM International has been successfully acquired by Evergreen Hill Enterprise. The company will now operate as an independent privately owned business with its headquarters located in Luxembourg.
SWM International is a leading supplier of premium, highly engineered lightweight materials. The company serves various industry segments, including tobacco, cannabinoids, battery, surface protection, packaging and medical. With a global footprint including facilities in Asia, Europe, Latin America and the United States, the company is home to nearly 2,000 employees worldwide, including an experienced management team.
“Today marks a milestone for our employees, our customers and our partners,” said SWM CEO Katrin Hanske in a statement. “Leveraging our profound engineering expertise in botanicals and natural fibers, we are dedicated to further advancing innovation in our distinctive products and technologies, all while expanding our manufacturing capabilities.”
The acquisition was first announced in August 2023. Headquartered in Singapore, Evergreen Hill Enterprise is affiliated with BMJ of Indonesia.
December 4, 2023
Cleaning Up

Photo: SWM
SWM’s new fiber-based filter media takes the plastic out of the cigarette.
By Stefanie Rossel
In addition to the health hazard they pose to users, combustible cigarettes also threaten the environment. Cigarette butts remain the most littered item on earth. According to World Health Organization estimates, 4.5 tons of cigarette filters are discarded in our planet’s natural habitats and waterways each year. Made from cellulose acetate (CA), cigarette filters take up to 18 years to disintegrate.
However, there is hope. In the tobacco industry’s move toward less harmful nicotine-delivery systems, sustainability plays an increasingly important role. In addition, the industry got a regulatory push toward using more environmentally friendly filters when the European Union introduced its Single-Use Plastics Directive in 2021.
The directive bans selected single-use products made of plastic for which alternatives exist on the market: cotton bud sticks, cutlery, plates, straws, stirrers, sticks for balloons, as well as cups, food and beverage containers made of expanded polystyrene and all products made of oxo-degradable plastic. The extended producer responsibility legislation, scheduled to come into effect in January 2023 for tobacco filters, appears to be behind schedule.
And there is more regulation to come: In March 2022, members of the United Nations Environmental Assembly agreed to propose by 2024 a legally binding treaty to end plastic pollution that includes the marine environment. Cigarette butts are the most common plastic litter on beaches. They represent a hazard for marine life as animals can ingest the trash, exposing them to harmful chemicals. These can also make their way up through the food chain, threatening human health on a global scale.
To help tobacco customers reduce the environmental impact of their products, SWM in June launched Evolute, a range of fiber-based filtering media that can replace CA in filters. Depending on the environment, filters made from Evolute degrade in a few weeks. In October, Germany’s technical inspection association TUV granted “OK biodegradable soil” and “OK biodegradable marine” certifications to Evolute.
Full Support Package
The new filter media are part of SWM’s ongoing efforts to provide its customers with alternative sustainable solutions and support, says Alice Jaussaud, product manager for Evolute filtering media at SWM. “We are going beyond the filter media themselves, offering the full support to design a cigarette with the purpose to work with customers and offer our expertise to the tobacco industry in its transition,” she says.
The company already has a natural fiber filter solution on the market, according to Cedric Rousseau, SWM’s tobacco solutions research, innovation and development director. Several big company brands use paper filters. “Paper behaves differently than cellulose acetate, so it calls for some adjustment in terms of design of the filter and the cigarette,” says Rousseau. “This is where SWM as a supplier of various materials to the industry can provide support to its customers to properly adjust the filter media and design of ventilation, filters and characteristics of the cigarette.”
While the company’s most recent development has just been introduced, SWM is already working on the next generation of alternative solutions. “The idea is to use the filter solution as a plug-and-play solution as compared to CA media,” says Rousseau. “Our vision is to offer the industry a wide range of different plastic-free media products so they can play depending on the market, the regulations and the consumer expectations in terms of sensory profile and taste.”
The Evolute range includes industrial and scalable products with proven filtration performance, filter pressure drop stability and perfect fit to crimped filter makers, according to SWM. In addition to conventional cigarettes, they are suitable for filter tips for roll-your-own, make-your-own, cigarillos and heated-tobacco products (HTPs), says Jaussaud.
The company has an R&D group focusing specifically on HTPs. “The filter of an HTP has a different role than that of a combustible cigarette,” says Rousseau. “Some HTP filters are more for the cooling, others for the filtration of the aerosol. With the dedicated group, we have a better understanding now.”
Drawing on its expertise with papers for the tobacco industry, SWM partners not only with companies that develop filters but also with filter-making equipment manufacturers.
Sustainable Plug and Play
The often-used argument that CA is the gold standard in terms of filtration properties and smoke chemistry may soon be outdated, according to Rousseau. At its Le Mans site, SWM has set up a sensory group to evaluate consumables for HTPs and combustible cigarettes. “Biodegradability and the environmental impact are important, but taste and tar retention are obviously important as well,” says Rousseau.
“We have observed that our standard paper filter that has been on the market for some time needs to be properly used because it has an impact on tar retention. Consequently, tar retention also has an impact on taste where we must develop the right design. The next generation of filtering media we’re currently working on should have the same performance, taste and experience as well as the same physical attributes as a CA but is paper based.”
Instead of a mere substitute for CA filters, SWM aims to provide an alternative with additional features, such as sustainability, Rousseau emphasizes. He is confident that the consumer is ready for such changes. “We are moving away from wanting to have something that behaves and tastes like CA filters to something that we believe consumers will be looking for in the future. We provide a lot of value with biodegradable cigarettes,” he says.
The EU Single-Use Plastics directive has been a clear catalyst accelerating the change to plastic-free filter alternatives, notes Jaussaud. However, she sees demand beyond the EU when talking to her customers. “Similar regulations are under discussion in the U.S., Canada, Australia and other countries,” says Jaussaud.
“What started as a regulatory push now looks more and more like a consumer demand,” she explains. “Consumers don’t want to see cigarette butts on the beach anymore, and they think it would be good to have something with less pollution. They are looking for such solutions, and manufacturers are considering that beyond regulation.”
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.

December 1, 2022
A Clean Sheet

Photo: phonlamaiphoto
Cigarette paper manufacturers are reconfiguring production processes to reduce their environmental impact.
By Stefanie Rossel
The effect of papermaking on the environment is considerable: According to Wikipedia, the pulp and paper industry is the world’s fifth-largest consumer of energy, accounting for 4 percent of global energy use. The sector uses more water than any other industry; producing 1 ton of paper requires an estimated 300 tons to 400 tons of water. Other issues include deforestation, greenhouse gas emissions, harmful chemicals and wastewater.
Driven by greater environmental awareness and stricter regulations, paper manufacturers have been moving toward more sustainable production practices. Tobacco Reporter spoke to leading players in the cigarette paper business about their strategies to reduce the environmental footprint of their operations.

Photo: BMJ
Reduce, Reuse and Innovate
Liem Khe Fung
Based in Indonesia, BMJ is the world’s No. 3 cigarette paper producer, supplying about 10 percent of global requirements. BMJ Innovation Center Director Liem Khe Fung is convinced that without a sustainability strategy, a company won’t survive the next 10 years to 15 years. Therefore, BMJ has adopted a strategy of “reduce, reuse and innovate.”
“First, we reduce energy consumption,” explains Liem. “Second, we reuse or recycle water from the production line to minimize the use of water from the river. We also select the chemicals used in the production carefully to minimize their impacts to the environment. Finally, we intend to replace plastic-based materials with paper/pulp-based materials, for example, replacing plastic[-based] or metalized-based packaging with paper-based packaging that is safe for the environment yet has the same functionalities.”
Paper machines consume huge amounts of energy. To reduce that consumption, BMJ replaced energy-hungry machine parts, such as the motors that drive the rolls, with more efficient parts. By generating and feeding exactly the right amount of steam to the drying drums, BMJ reduced waste. The company also captured part of the carbon dioxide (CO2) emissions from its coal boiler and used them to produce calcium carbonate (CaCO3), a key chemical in papermaking. According to Liem, using CaCO3 in liquid form saves much energy because it eliminates the need to transform the chemical into a powder for transportation.
Such actions have enabled BMJ to reduce its energy consumption by about 15 percent in just a few years.
Papermaking also requires lots of clean water, an increasingly scarce resource. Water accounts for up to 99.9 percent of the material mixture in the web-making process. Water is also used to generate steam to dry the web or paper. To reduce water consumption, BMJ modified its No. 3 paper machine to recycle water back into the production process several times before sending it to wastewater treatment.
Currently, BMJ derives 20 percent of its water requirements from recycled water. The company aims to use 50 percent recycled water by the end of 2023.
Looking ahead, BMJ hopes to install renewable energy systems, such as solar panels, by 2023. “We also would like to replace some of the coal used in our boiler with biomass,” says Liem.

Papermaking requires large amounts of energy and water. (Photo: Jose Luis Stephens)
Own Your Power
Vincent Li
Creating an in-house green energy supply is also at the heart of Hengfeng Paper’s sustainability strategy. With 21 production lines and an annual production of 230,000 tons, the Chinese manufacturer of cigarette paper, plug wrap and tipping base is an industry giant.
The company, which celebrates its 70th anniversary this year, recently published a carbon footprint status and emission reduction action plan designed to meet government requirements. In September 2020, President Xi Jinping announced that as part of the country’s 14th five-year plan, China would strive for peak CO2 emissions by 2030 and carbon neutrality by 2060.
Due to its level of development, China’s primary energy demand is expected to increase to 6 billion tons of standard coal by 2030. The government aims to increase the proportion of power generated by clean energy sources to 59 percent by 2030 and 86 percent by 2050 while boosting the proportion of electricity generated by clean energy sources to 48 percent by 2030 and 83 percent by 2050.
To help China meet these objectives, Hengfeng plans to slash its carbon emissions by more than a third in eight years. The company will focus its efforts on improving the efficiency of power and steam acquisition, as a carbon footprint analysis identified these activities as the major contributors to the company’s global warming potential.
Among other initiatives, Hengfeng plans to build a 10 MW photovoltaic power plant. The company has already signed cooperation agreements with partners and is currently preparing for construction, according to Vincent Li, sales manager at Hengfeng Paper’s Export Department II. Upon completion, the facility will generate up to 1,000 kWh, which will be fully used for paper production.
To recover energy, Hengfeng will deploy cogeneration technology, which involves the thermodynamically efficient use of fuel. “In traditional power production, some of the energy must be discarded as waste heat, but in cogeneration, some of this heat is put to use,” explains Li.
“Hengfeng makes full use of low-pressure steam after power generation for paper drying to achieve the purpose of maximizing energy utilization,” he says. The company fully recovers and utilizes the heat of the condensed water generated by the paper web drying process. It also plans to install high efficiency heads on the water pipe for washing. “We will promote high-pressure cleaning of the Fourdrinier* sections, thus improv[ing] the cleaning efficiency and sav[ing] the washing water by mobile spray and increasing the spray pressure,” adds Li.
Hengfeng has also been working on reducing its carbon footprint in CaCO3. “Hengyuan biochemical company, the calcium carbonate supplier [for] Hengfeng, introduced German process technology in 2017 and introduced the flue gas of Hengfeng’s thermal power plant into the reactor through an overhead pipeline,” says Li. “It uses quicklime and carbon dioxide in the flue gas to generate light calcium carbonate, comprehensively utilizes the carbon dioxide in the flue gas and reduces the carbon dioxide emissions. The annual comprehensive utilization of carbon dioxide in the flue gas is about 22,000 tons.”
To reduce fresh water consumption, Hengfeng has expanded the volume of its storage tank and increased the share of recycled water, among other measures. “We also introduce, popularize and apply new water-saving technologies and carry out a water-saving inspection every month to ensure that water-saving targets are achieved,” says Li.

SWM’s Quimperlé facility in Brittany, France. (Photo: SWM)
A ‘Thinner’ Impact
Marc Bettoli
SWM, a provider of engineered fine papers with expertise in natural fiber-based solutions, has launched a new initiative called “Thinpact” that regroups its different actions across its engineered paper division.
The company aims to set an example for the industry by researching and developing sustainable processes and solutions while being authentic and transparent about the process.
For the 2020–2030 period, SWM wants to reduce the CO2 emissions of its engineered papers business unit by 40 percent and its water withdrawal volumes by 25 percent.
“Reducing our impact is a complex process to which SWM is fully committed,” says SWM ESG Manager Marc Bettoli. “We decided to act step by step, starting with energy and waste. The first step for the reduction of carbon emissions is a program launched on Scope 1 and Scope 2—direct and energy-related—emissions. We have designed a sufficiency plan in order to get the right setting on paper machines. For instance, the drying temperature is set differently depending on the reference produced on the machine. We have also developed a plan to run the most efficient assets for the needed usage. For instance, we choose a pump with the best power, yield or technology, or we recover all possible heat from steam. The third step is the use of renewable sources of energy. For instance, we will add renewable electricity in the power mix.”
SWM has reduced its CO2 intensity—that is, the CO2 equivalent emissions per metric ton of goods produced, Scopes 1 and 2—by 11 percent between 2020 and 2021. At its largest site, Quimperle in France, the company has saved 3 percent of energy consumption year to date.
Waste reduction is also on SWM’s agenda. At Quimperle, the company plans to reduce landfill waste by 30 percent in the first year of a pilot program through internal incentives and education, waste assessment and waste valorization.
In addition to Quimperle, SWM has two other paper mills in France. This summer, France experienced the impact of climate change firsthand through a historic drought.
At the time of writing, the company’s French sites had not yet been impacted by water scarcity. “We are monitoring water levels on all sites with environmental managers at the sites, and we are in close contact with administration to [make] decisions if needed, especially in times of crisis,” says Bettoli. “We have implemented water recycling modes that were prepared for a long time. With the specific program on water management in order to reach or exceed our minus 25 percent goal for 2030, we will be prepared for upcoming historic droughts.”
Some of SWM’s energy comes from biomass. In Le Mans, for example, a biomass boiler produces steam. “We have developed a plan to roll out biomass boilers on other papermaking sites by 2030,” says Bettoli. “We are currently studying possibilities to add renewable electricity in our power mix, with the ‘Virtual Power Purchase Agreement’ approach.”
The company has also installed several energy recovery processes in its mills. The Quimperle plant, for example, both produces and burns black liquor, a byproduct of pulp processing, for energy recovery. SWM uses heat exchangers to recover energy losses of air and hot water and heat from production processes to heat its offices and buildings. It has also implemented hood closures and automatic controls to limit losses such as exhausted air.
By reusing excess water from the paper machines for dilution in the stock preparation area, the company reduces water consumption. For that purpose, SWM has implemented a fiber recovery system.
Bettoli says the company is also reshaping product design to support the development of new products that have a lower overall impact. “This approach is included in our R&D processes,” he says. “We have developed an eco-scorecard, and we are looking forward to collaborating with the industry to reduce the impact of our activities together. One recent example is the Evolute filter media product range, which is paper for filters to replace standard acetate within filters.”
*Modern papermaking machines are based on the principles of the Fourdrinier Machine, which uses a moving woven mesh to create a continuous paper web by filtering out the fibers held in a paper stock and producing a continuously moving wet mat of fiber. This is dried in the machine to produce a strong paper web.
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.

October 3, 2022
No Paper Tiger

SWM’s new technology allows for the creation of patterns, designs and logos inside the gum strip without compromising sticking quality. (Photo: SWM)
Schweitzer-Mauduit International has introduced a new gumming technology to help rolling paper manufacturers protect their brands against counterfeiting.
By Stefanie Rossel
In recent years, cigarette rolling papers have been in high demand; the global roll-your-own tobacco product market, valued at $7.49 billion in 2020, is expected to expand at a compound annual growth rate of 4.2 percent from 2021 to 2028, according to Grand View Research. The increasing preference for handrolled or handmade cigarettes, a cheaper alternative to factory-made cigarettes, has been driving the demand for roll-your-own products. It has been aided by the legalization of cannabis for medical and recreational purposes in a growing number of countries around the world.
As demand for rolling papers has increased, so has counterfeiting of these products. Reports on seizures of significant quantities of fake products, predominantly in the U.S., have repeatedly made the headlines. Rolling paper manufacturers have filed civil actions seeking monetary and punitive damages and injunctive relief from those who traffic in counterfeit goods and who have profited from their sale and distribution. Several leading suppliers of rolling papers have installed dedicated sections on their websites that encourage the reporting of fake products.
While manufacturers fear the financial damage and the harm counterfeit papers cause to their brands’ image, fake products also pose a grave risk to consumers as they are often manufactured using unsafe production practices and unknown and hazardous or toxic ingredients, such as chlorine bleach or petroleum-based adhesives.
Pierre Yves Kervennal
To support its customers in protecting their brands against counterfeiting, Schweitzer-Mauduit International (SWM) has introduced a new generation of gumming technology. “Our new gumming technology is a completely different approach of the existing gumming technology,” explains Pierre Yves Kervennal, product manager for rolling papers at SWM’s engineered papers business unit. “It’s a new space of communication and enhancement of the brand for our customers. The use of natural and colored gum, perfectly in accordance with the legislation, allows us to create patterns, designs and logos inside the gum strip without diminishing the ‘sticking’ quality of the Arabic gum. This opens new opportunities for our clients to differentiate on the market but also communicate with their customers. We called this new service of customization of the gummed band ‘Be Unique.’”
According to Kervennal, tobacco companies are battling counterfeits every day. “It’s not only a financial loss for them but also a reputation hazard,” he says. “And to be fair, the paper industry didn’t bring a lot of solutions to the market over the recent years. Of course, the filigreed papers and the good market practices such as ‘Know Your Customer’ already protect our customers and make it really hard for forgers, but, unfortunately, this is not 100 percent bulletproof. Our clients now have a new weapon at their disposal. Our innovative and patented technology allows to add an additional layer of complexity whilst giving them additional marketing opportunities. In fact, ‘Be unique’ is just an example of the bank note strategy; each time a new bank note is introduced on the market, new technologies are added to the paper to make it safer.”
Driven by Cannabis
In Europe and the Middle East, rolling papers are a historical product of the tobacco industry, Kervennal points out. As such, they face the same kind of issues as any other products from this industry. “It means that major brands can be copied, and with the multiplication of the new distribution channels, the risk of buying counterfeit products is growing for customers. During the Covid crisis and the border closures, we have seen legal markets grow about 10 percent just because the counterfeit products could not come through anymore. In the U.S., this is a very dynamic and trendy market, with some brands already well installed and providing high-quality products. These brands are going to be the ones who will have to fight against counterfeiting—the more dynamic the market is, the more attractive it is for unfair players.”
Responsive to consumer demand, SWM is increasingly focusing on solutions that cater to the growing market for recreational cannabis. “In terms of product design, we develop more and more specific grades and product for cannabis use, such as hemp and unbleached paper,” says Kervennal. Another trend in the roll-your-own market is a desire for differentiation. “We observe an increasing demand from companies creating their own brands and looking for new visual design.”
In the U.S., the RYO papers segment is driven largely by the cannabis market. “Consumers in that market are looking for all-natural products, typically hemp-based products, and brand owners are looking to differentiate their offering through customization,” says Kervennal. “Some additional trend we see in the United States is continuing legalization. Right now, there are 18 states plus the District of Columbia where adult use of cannabis is legal, and that will continue to grow over time. A last trend that we do see is celebrity brand endorsers where brand owners are using celebrities to endorse their brands on social media, which increases demand for roll-your-own papers.”
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.

December 1, 2021
Troubled Waters

A flat corporate hierarchy and short lines of communications helped Glatz Feinpapiere cope with the coronavirus pandemic disruptions. (Photo: Glatz Feinpapiere)
The cigarette paper sector is coping with rising costs for raw materials, energy and transportation.
By Stefanie Rossel
Paper manufacturers have learned to cope with the pressure brought about by slumping global cigarette consumption and the simultaneous rise of paperless next-generation products. Since 2013, worldwide sales of combustible cigarettes have decreased every year, with consumption standing at 5.06 trillion cigarettes in 2020, down 3.7 percent from 2019, according Euromonitor. In 2019, the combustible cigarette category accounted for an estimated 95 percent of the global tobacco market, down from 94 percent one year previously.
As if this hadn’t been enough, Covid-19 presented a range of further challenges for paper suppliers. “On top of [the shrinking global combustible cigarette market], the situation this year has been exacerbated by container shortages, resulting in higher raw material prices and delivery delays,” says Omar Rahmanadi, CEO of Indonesian cigarette paper maker BMJ. “Nonetheless, like Albert Einstein once said, ‘In the middle of difficulty lies opportunity.’ The global crisis has forced many buyers to revisit their sourcing strategy, which has subsequently opened new business opportunities.”
Katrin Hanske
“Security of supply is even higher on the agenda since the Covid-19 crisis,” says Katrin Hanske, vice president and general manager of SWM’s Tobacco and Alternative Solutions division. “The cigarette paper manufacturers have to ensure a high level of service and quality and must be even more agile in a rapidly changing environment. Having a global footprint and a strong global supply chain is a true advantage to serve our customers located all around the globe.”
“Like the whole world, we were also not prepared to face the challenges of a worldwide pandemic,” says Nina Ritter-Reischl, CEO of Glatz Feinpapiere in Germany. “However, we were able to quickly adapt to the new situation, especially due to our flat hierarchy and short lines of communication. Particularly during the first months of the pandemic, we were faced with high demand for our papers, so we quickly increased our capacity by adapting flexible working hours or shift systems. In combination with the new sanitation and distance regulations, this was a challenge of its own.”
Coping with Costs
Rising prices for raw materials and energy, too, are impacting cigarette paper producers. “The global cigarette paper market in 2021 is dominated by a rapid increase in the costs for pulp,” says Ritter-Reischl. “From January to August, the costs for short fibers have increased over 70 percent and the costs for long fibers over 50 percent. This rapid increase is joined by rising costs for transportation, energy, chemicals and additives in general. Worldwide logistics and workflows still suffer from lockdowns of the Covid-pandemic. Therefore, the cigarette paper industry, just as the paper industry worldwide, is struggling with unexpected high costs, transportation challenges and the consequences of Covid.”
As a consequence of this development, SWM raised prices by up to 15 percent across its engineered papers portfolio on July 1, 2021. The increases, the company said in a press release, were a direct result of sharp rises in raw material prices, with market wood pulp costs up by 50 percent in the past six months. “Largely because of the Covid-19 pandemic, 2020 saw a lower than expected demand for wood pulp and higher inventory levels,” SWM commented. “Since Q4 2020, demand in Asia has recovered strongly, driving inflation and a fast decrease in global inventory levels. Supply levels have turned toward Asia, leading to one of the sharpest price increases in recent history. In addition, polymer prices and packaging material costs remain highly volatile. At the same time, shipping companies are capitalizing on high demand following periods of congestion to leverage their pricing power as well as providing limited visibility on freight rates and special surcharges.”
Although heated-tobacco products represent less than 2 percent of global tobacco retail volumes, according to Euromonitor, they will likely have an impact on the paper business, predicts Rahmanadi. “Heat-not-burn [HnB] products have disrupted the conventional cigarette industry,” he says. “This will undoubtedly disrupt cigarette papers as well. This development requires us as a specialty paper manufacturer to intensify our innovation to support the growth of HnB products.”
Trend Toward Sustainability
Despite current challenges, cigarette paper manufacturers remain optimistic. New business opportunities, they agree, are about to arise from tobacco companies’ focus on sustainability. “This is a trend and customer need we can serve, as it is in our genes,” says Reischl. “As a family-owned company with more than 135 years of history, we are sustainable in more than one way. Not only do we live and work carefully with the resources that nature is giving us—from water quality, emission reduction to energy savings, we [also] yearly reduce our footprint. We are also a sustainable partner for all our business partners, suppliers as well as customers.”
Rahmanadi sees big opportunities in developing a paper-based material that can replace single-use plastics, not necessarily exclusive to the cigarette industry. “The global pandemic has demonstrated that people have the capability to tolerate changes more than what they thought they could. This could mean that people might be willing to sacrifice convenience for environmental sustainability by using paper-based materials instead of plastics, among others,” he says.
“With the EU’s 2019 single-use plastics directive, paper filters made from cellulose fibers represent a great sustainable alternative for the industry,” notes Hanske. “They provide many benefits being an efficient plastic-free solution made with 100 percent renewable raw material, leaving no trace thanks to its faster degradation. We also observe that the industry is looking to use more natural materials for their packaging. It is again an opportunity for SWM to put decades of know-how at the service of the market.”
According to Hanske, SWM is ready to serve its customers no matter where the market takes them. “Beyond cigarette papers, the priority at SWM today is to offer the technical solutions needed by our customers to adapt and grow their business, be it in the traditional cigarette market or in the developing spaces like heated-tobacco products, smokeless or cannabinoids.”
Stefanie Rossel is Tobacco Reporter’s editorial contributor. An experienced trade journalist, she combines sharp reporting skills with in-depth knowledge of the tobacco and vapor industries. Prior to joining Tobacco Reporter, Stefanie was editor-in-chief at Tobacco Journal International, where she worked for a decade. Fluent in English, German and French, Stefanie covers tobacco news around the world. She is based in Germany.

October 1, 2021
Recon Mission

Photos: SWM International
LeafLAB has revolutionized the all-natural hemp and CBD markets with its new, consistent and high-quality hemp-based botanical recon product.
By Timothy S. Donahue
Regulation is coming for the cannabidiol (CBD) industry. The U.S. Food and Drug Administration (FDA) has said that it recognizes the opportunities that cannabis or cannabis-derived compounds may offer and acknowledges the significant interest in these possibilities. However, the FDA is also aware that some companies are marketing products containing cannabis and cannabis-derived compounds in ways that violate the Federal Food, Drug and Cosmetic Act.
To prevent the health and safety of consumers from being placed at risk, the federal agency plans to regulate CBD and other consumable hemp products. It is expected that the FDA will regulate smokable CBD products much in the same way that it regulates traditional tobacco products. That means a product must be consistent and able to be tracked and traced back to the farm level. This could present several challenges for manufacturers, especially when trying to find consistency in quality and quantity of CBD and other variables in cannabis plants for smokable flower products.
LeafLAB, the botanical-based brand of SWM International, a manufacturer of tobacco papers and reconstituted tobacco technologies, can produce reconstituted cannabis substrates to use in the production of smokable CBD products and accessories. Among its many specializations in plant-based botanicals, LeafLAB produces product from all-natural industrial hemp biomass that complies with all regulations for THC content of less than 0.2 percent. The company also produces industrial hemp-based filtration media and papers for cigarette paper and traditional roll-your-own (RYO) applications, not to mention technical support, service and a global reach to its customers.
“We’re taking the knowledge and experience of our leadership in the tobacco industry to help bring a new market to fruition through the addition of new product opportunities for the existing consumer and our direct customer base,” says Alex Boone, director of alternative products for SWM. “Centuries of tobacco experience can now be used for those same components used in tobacco products but now replacing tobacco with all-natural industrial hemp-based raw materials.”

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Distinct parallels
Hemp wraps
LeafLAB’s ties to the tobacco industry play a pivotal role in the development of its smokable hemp products. “We believe the technologies and knowledge that we’ve developed over time in tobacco have a distinct and valued parallel for this new industry. Today, 45 percent of the legal cannabis market is still flower—smokable flower,” says Boone. “Not only have we created hemp-based botanical wraps to support the current combustible flower market, but our cut rag filler products allow our customers another opportunity to offer completely distinct product lines, including tobacco-free alternatives to mainstream cigarette smokers.”
LeafLAB specializes in all-natural products. Boone explains that with today’s lifestyles leaning toward more all-natural products, there are not many options beyond smokable flower. LeafLAB makes hemp products better through a patented process technology that eliminates the necessity for chemical additives, says Boone. Through its botanical process, LeafLAB uses legal cannabis flower to create smokable products efficiently using the same high-quality systems of infrastructure and quality control that is used in the tobacco industry.
“Instead of using hemp from just the stalk as is done in many textile and paper making processes, we are using the raw leaf and flower biomass to produce our product, and that’s the key. It’s naturally aromatic; you can still smell, and to a lesser degree taste, the natural terpene profile of the raw material. Many of our customers have said that our product looks, feels and smells like real hemp. That’s because it is—and all of this without a papery taste. By being neutral, our customers can apply their own terpene and or flavor profile,” Boone says. “The range of tastes from the consumer are infinite. From high terpene profiles to match cannabis-like flavors to heavy fruit and honey-based products for others. However, what they all want is something natural. Now, we can do that in a 100 percent hemp product that is completely tobacco and nicotine free.”

SWM’s Ancram Mill
Advances technologies
Over the last year, LeafLAB has developed advanced processes for making products such as hemp leaf and flower-based blunt wraps and cones and for machine-made CBD cigarillos (hemp pre-rolls). “We have a whole line of RYO hemp wrappers that complement our traditional lines of cigarette paper and RYO papers that can be used on machines to roll these new hemp sticks,” explains Boone. “In addition, we have an all-natural hemp-based filler or cut rag that is 100 percent hemp ‘recon’ in which terpenes, flavors and CBD can be added for mass market stick production where controlling levels of active ingredients is essential for meeting future potential regulatory control.”
SWM invented the reconstituted tobacco market in the mid-1950s, first with binders and wraps for machine-made cigars and later as a filler used by tobacco blenders, not only as a recycling option for expensive virgin material but also as a tool for blend design optimization through higher filling power and to control consistency from one tobacco crop year to the next.
“Much like in tobacco, LeafLAB’s hemp-based filler can use distinct blends to create this same consistency for its customer’s products year after year,” says Boone. “In addition to our cut rag offering previously mentioned, our hemp ‘recon’ is also a great blender with hemp flower allowing for better control. That blending not only enables a manufacturer to be able to blend from one crop to the next but allows for usage of high-speed machinery and control of sensory properties. Our recon substrates allow for excellent retention of flavor and active ingredients.”
LeafLAB uses specific biomass from suppliers or biomass that is directly specified by its customers. Boone explains that LeafLAB gives manufacturers that choice because many customers want that “farm-to-table” experience for their consumers. “We are also very choosy in the consistency of our raw materials. High leaf and flower content and low stem—that is the perfect fit for our process to allow for the best opportunity for paper forming characteristics and taste,” he says. “Regardless, all raw materials go through an extensive laboratory and taste profile testing prior to use in a commercial setting. Additionally, we require our suppliers to provide a full spectrum analysis—pesticides, heavy metals, THC/CBD content, etc.—and farm traceability of each biomass shipment. Our customers can be assured we are setting the appropriate standards necessary for safe and reliable products.”
Runnability
Alex Boone
The ability to have a hemp product work well on current cigarette rolling machine designs is important. Raw hemp flower is typically too sticky and granular to be used in traditional tobacco rolling machines. Boone says that LeafLAB’s hemp sheets help meet the needs necessary for bringing smokable hemp to a mass market.
“Today, legal cannabis runs very slowly on traditional cigarette machines. We estimate somewhere in the 300 sticks per minute range. This is not efficient for high-speed makers. We understand there is new machinery under development that is beginning to make the process easier. These new machines will run up to 1,500 sticks a minute and greatly improve pre-roll stick production,” says Boone. “With our product, you can run as high as 6,000 sticks per minute using our hemp wrapper and hemp cut rag combination and perhaps higher running a 100 percent hemp cut rag. Now, you are able to achieve the speeds of traditional cigarette production. So, suddenly, you can build to scale smokable hemp products that you otherwise could not have. This is a game changer.”
LeafLAB started in 2014 as a botanical innovation platform for SWM that was geared toward using something other than tobacco to bring new products to market. LeafLAB started with reconstituted tea and moved on to reconstituted mint, sage and even cocoa, to name a few. “Today, we have a line of packaging paper using cocoa shells as its base material called Cocoa Paper,” adds Boone. “It’s really rather cool.”
With the tobacco industry in decline, Boone said LeafLAB was a catalyst to start using the knowledge and experience of SWM to invent new products, such as the recon-style tobacco substrates used in heated-tobacco products (HTP). Today, this dedicated form of recon is an essential component of the consumables used. Currently, LeafLAB has 15 patents and over $7 million invested in its product development.
Packaging is also important when developing a brand of products. That packaging can be designed to have a familiar feel to the end user. If someone is using smokable CBD to help stop smoking nicotine cigarettes, for example, having the same style of packaging and consistency of product are major influencers of getting a consumer to commit to a brand, according to Boone. “We’re suggesting that, if you have a product that’s consistent—you can control it—you can get that into the mainstream market,” he says. “You can also make it taste like tobacco if that’s what’s desired.”
Looking ahead, Boone says LeafLAB will continue helping to improve the commercial hemp industry by teaching the supply chain how to conform to its legacy business quality control and proven SWM protocols coupled with the requirements of the non-THC legal cannabis industry. “We’re blending those two to have a very good quality product that follows strict standards and where our customers can trust in our COA [certificate of analysis] that says, ‘This is California regulation compliant’ or ‘this is FDA complaint’ when the time comes. That is the ultimate goal,” Boone explains.
Moving past the unknown regulatory environment, Boone says there is plenty of opportunity for LeafLAB’s products throughout the world. “We’re watching Europe. I would say that the U.S. and Canada are growing quickly—plus 18 percent CAGR [compound annual growth rate]. The next major markets in [the] EU are Luxembourg, Belgium, Spain and Germany,” he says. “South Africa just issued industrial hemp legislation but remains conservative in their approach. Overall, it will take time, but we are bullish on growth of legal smokable hemp products.”
Timothy Donahue is the assistant editor of Tobacco Reporter. Since joining our team in January 2013, he has become not only an expert on the traditional tobacco business but also a well-respected voice in the rapidly developing vapor industry. Tim spends much of his time on the road, attending conferences and interviewing industry representatives. His networking skills, work ethic and quick mind are valuable assets to our diverse audience.

October 1, 2020