The report said government bag charges had reduced the sale of single-use carrier bags since it was introduced.
But the largest 10 supermarket chains in Wales issued 65.2 million reusable plastic bags between 2017 and 2018.
Environmental charities said they were still treated as disposable by many people.
Wales became the first UK nation to introduce a requirement to charge for most single-use carrier bags in 2011, making a plastic "bag for life" a more cost-effective alternative.
However, a recent study concluded that most need to be used at least four times to be more environmentally friendly, and many do not see this lifespan.
A total of 94.1 million single-use carrier bags were issued in Wales in 2017-18, compared with 119.4 million in 2015-16.
Many larger retailers are opting to further reduce their carbon footprint, offering paper bag alternatives to single-use carrier bags and "bags for life".
Morrisons introduced paper bags earlier this year and said they hope it will remove an estimated 1,300 tonnes of plastic from the environment each year.
Andy Atkinson, group customer and marketing director, said: "Our customers have told us that reducing plastic is their number one environmental concern so introducing the paper bag across the nation will provide another way of reducing the plastic in their lives."
Prof Wouter Poorting, an environmental psychologist at Cardiff University, said the decline in purchases of single-use carrier bags showed the charge had remained highly effective in changing people's behaviour.
However, he added that paper bags were not the answer and the Welsh Government should increase the price of "bags for life" to provide a greater incentive to reuse them or bring alternatives.
"Although they are not made of plastic, they are effectively single-use," Mr Poorting said.
"What a lot of people don't know is that it takes more energy to produce paper bags, so they are not good for the environment either."
The Welsh Government said it was "proud to be the first country in the UK to introduce a charge for single use carrier bags".
A spokesman said: "We are committed to doing everything we can to reduce the amount of waste."