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Nowadays, it is not easy being an independent folding carton manufacturer. - G2
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1 MIN READ

Nowadays, it is not easy being an independent folding carton manufacturer.

June 7, 2018
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Blog

North American producers of coated recycled paperboard (CRB) are not taking any new orders. They are experiencing near-record industry backlogs and prices are going “crazy,” with yet another price increase slated for June. This situation, combined with reduced capacity (two mills closed in 2017), is squeezing out any potential benefit from the collapse of recovered paper costs due to China’s temporary bans on US imports. All in there is tremendous pressure on folding carton manufacturers to look for supply alternatives worldwide.

All five North American CRB producers (Graphic Packaging, WestRock, Paperworks Industries, Caraustar and White Pigeon Paper) have announced increases of $50/ton effective June 1, 2018. This is the second increase in less than 6 months. CRB producers justified their second price increase for 2018 by citing tight supply/demand conditions, substantial freight cost, service issues, and higher costs for chemicals, energy and health care for workers.

After hitting a recent peak, the American Forest & Paper Association (AF&PA) shows that CRB unmade orders were up 56.1% to 182,000 tons for the week ending May 16, 2018. The North American market remains concentrated on the supply side, with Graphic Packaging remaining the largest CRB producer with ~44% share of the market (even after closing its Santa Clara, CA, mill in December), followed by WestRock with ~32%, PaperWorks ~12%, Caraustar ~8% and White Pigeon ~3%, according to RISI and AF&PA capacity estimates.

As an independent folding carton manufacturer, we are forced to look for CRB alternatives all over the world. The Folding Carton Division of SupremeX is partnering with overseas mills in order to source new supply alternatives and hedge your raw material price hike risk. Feel free to contact us if you need any assistance or have questions: pack@supremex.com

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Nowadays, it is not easy being an independent folding carton manufacturer. - G2