The investment forms part of the group’s €1bn expansionary capital investment programme to accelerate growth in sustainable packaging, and will further strengthen Mondi’s position in the market.

The group said the investment would help it to meet the growing demand for paper-based flexible packaging, underpinned by growth in e-commerce and sustainable packaging, and will contribute to increasing its range of “innovative, sustainable packaging and paper solutions”.

The new machine will produce around 210,000 tonnes per annum of sack kraft paper, supporting Mondi’s Paper Bags business.

It will also enable the company to optimise production across the remaining kraft paper portfolio and strengthen its position in speciality kraft paper across a broad range of applications, such as functional barrier papers.

Thomas Ott, CEO of Flexible Packaging at Mondi, said: “As a global leader in innovative and sustainable packaging solutions, we are pleased to announce the approval of such an important investment.

“Sustainability is at the heart of all we do and this is a big step forward on our journey to making all our packaging solutions reusable, recyclable or compostable, which is one of our Mondi Action Plan 2030 (MAP2030) commitments.”

Mondi is also building a new R&D centre at its Steinfeld site in Germany to drive innovation in sustainable plastic and fibre packaging materials.

Set to cost €5m, Mondi has already commenced construction on the centre, which is due for completion in late 2023.

Last week Mondi released strong financial results for its Q3 period.