Global paper industry 'to focus on biofuels'

Companies in the paper and packaging sector will experience growth through the rapid expansion of the biofuels industry, a new report has claimed.

The study by the Deloitte Touche Tohmatsu Global Manufacturing Industry group noted difficult economic conditions will drive interest in the burgeoning sustainable power market.

John Dixon, leader of paper and packaging at Deloitte, said: "Growing investments in biofuels from wood residues could improve operating margins and create a lower dependence on fossil fuels for producing energy internally."

Mr Dixon added that several firms across Europe and North America are already exploiting these opportunities and are making speculative investments in biofuels.

According to the expert, branching out from traditional avenues is likely to help sales and volumes in organisations throughout the sector, particularly in high-growth countries such as China and South America.

Biofuels were recently described as a "critical" component for being able to meet Britain's transport emissions targets by chief executive of the Carbon Trust Tom Delay.