Forecast predicts steady containerboard growth

A forecast prepared by Raleigh, North Carolina-based Beroe Inc. cites the e-commerce sector as a significant demand driver of the containerboard market, with emerging markets in Asia and Latin America expected to grow nearly 4 to 5 percent annually until 2021.

Beroe, which describes itself as a procurement intelligence firm, says the containerboard and corrugated box market also will be boosted by the shelf-ready packaging (SRP) trend. SRP techniques can use printed corrugated packaging to ship a product and then open and unfold it to be used for display in retail stores.

The report says global and regional containerboard markets are “dominated by the recycled variants” of the product, although in North America the availability of virgin fiber and containerboard machines designed to handle pulp furnish lends greater market share to wood pulp.

North America remains a major exporter of virgin grades to destinations including Central America, Asia, and Western Europe, which together consume more than 60 percent of North American exports, according to Beroe.

In terms of future global containerboard production, the Asia Pacific region will continue to post the fastest growth, and China is being forecast to contribute to the maximum growth in the market until 2020.

Within the North American market, the demand for Mexican board is a key price driver in the corrugated board industry. That demand is estimated by Beroe to grow at the rate of 2 to 3 percent by 2020. This is mainly due to the growing agricultural sector, where the demand is forecast to grow at the rate of 3 to 4 percent through 2020.

The containerboard market in North America is described as highly consolidated by Beroe, with the top five companies accounting for 75 percent of the market share. “Hence, cooperation levels are high during price fluctuations,” says the firm.

A major product trend in the corrugated board industry includes lightweight containerboard products, with the basic weight being less than 26 pounds per thousand square feet, which has significantly helped in the reduction of freight costs. Beroe also cites “innovative fluting design, which offers superior printing as well as cost savings through effective volume utilization, [which] has also helped drive the industry.”

Beroe says interested parties can pay to access the full report or download a sample via its recently launched market intelligence platform on this web page.