Corrugated/Paperboard Box Demand to Rise

March 7, 2008 - Demand for corrugated and paperboard boxes is expected to rise 2.5 percent annually through 2012 to $39.9 billion, with gains driven by an increase in the production of both nondurable and durable goods, according to a recent study conducted by the Freedonia Group.

The study, Corrugated & Paperboard Boxes, said advances will be bolstered by the increasing importance of higher-value boxes offering improved printing and graphics capabilities as producers seek ways to boost the aesthetic appeal of boxes in the face of competition from alternative packaging. The continued popularity of Internet shopping will also drive demand for shipping boxes.

Sales of corrugated and solid fiber boxes, which accounted for more than 70 percent of demand in 2007, will increase 2.7 percent annually through 2012 to $28.8 billion. Growth will be based on their well-entrenched position as low-cost shipping containers in virtually all manufacturing sectors. Demand will also be supported by the good environmental profile of corrugated boxes, which will become increasingly advantageous as interest in sustainable packaging continues to rise.

Folding paperboard box demand will increase 1.7 percent annually through 2012 to $10.5 billion, slower than corrugated box growth as folding cartons face heightened competition in many markets from alternative packaging such as pouches, clamshells and blister packs. Nevertheless, folding carton sales will be supported by advances in printing and paperboard graphics capabilities and a better environmental image than plastic packaging. Demand for set-up boxes will primarily be driven by their extensive use in high-end confectionery, and silverware and jewelry applications.

Food and beverages will remain the largest market for boxes, accounting for more than 40 percent of demand in 2012. Favorable growth will be registered in markets such as beverages, meat products, fresh produce and frozen foods. Other nondurable goods markets offering good prospects for boxes are pharmaceuticals, cosmetics and toiletries, and rubber and plastic products. In durable goods markets, the best prospects will be in medical and other instruments, and entertainment and software products. Faster box growth in non-manufacturing markets, such as retail shipping and carry-out foodservice, will be supported by the continued expansion of Internet shopping and the increased share of spending for food eaten or prepared away from home.

SOURCE: Freedonia Group

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