MethodologyContact usSupportLogin
For the second November in a row, Packaging Corporation of America (PCA) announced a containerboard price increase that has been followed by producers controlling a large majority of US containerboard capacity. All five of the top US containerboard producers have announced a January price increase of $60-70 per ton for linerboard.
For the North American paper packaging market, this price increase alongside a range of macroeconomic factors has left industry players uncertain about the future.
Want more like this? You can subscribe to the Fastmarkets North America Paper Packaging Forecast to access the full report.
Demand has lagged in the North American economy since 2022, resulting in uncertain recovery potential in the typically stable US containerboard and corrugated market.
Export growth helped operating rates climb in 2024, but there are still significant risks abound in the industry. Exports play an important role for many US containerboard producers, including as a release valve for overcapacity when domestic market conditions are slow. Weak global demand conditions and rising supply made it difficult for North American mills to place export tonnage for much of 2022-23.
US offshore exports of kraftliner began to rebound strongly in the second quarter of 2023, climbing to more than 50% above year-ago levels by the end of the year. Disruptions to global trade such as the Red Sea crisis helped US exports return to peak levels despite severe global oversupply. Since peaking in April 2024, US containerboard exports have cooled, succumbing to globally weak demand.
Heading into 2025, producers have announced another price increase. With overall demand still sluggish, this announcement follows the pattern of the 2024 price increases in that it is driven primarily by margins rather than demand and capacity.
One important difference compared with the 2024 increases is that recycled fiber costs declined in the second half of 2024, so the increase announced for early 2025 will test producers’ ability to pull ahead of cost inflation in the absence of traditionally tight market conditions.
Our baseline price outlook shows the price increase announced for January 2025 mostly making it through the market, with another increase projected for early 2026 — the seasonal timing of price increase attempts has seemingly shifted to the first quarter.
This outlook will leave prices rising an average of 7% per year in 2025-26, after which we expect the pace of containerboard price increases to decelerate to the pace of overall inflation.
We expect US containerboard demand (apparent consumption) to increase at a rate of 453,000 tons per year in 2025-29, with the largest gains in 2025-26. Over the next 15 years, containerboard demand is forecast to rise an average rate of 425,000 tons per year. After the assumed recovery in 2025-26, box shipments growth will slow to 1.2% per year, an outlook that is still on the high side of the historical performance.
The EU Deforestation Regulation (EUDR) has been delayed to 2026, and the large risks for US containerboard exports that were present in the original draft of the legislation seem likely to be substantially reduced in its final form. However, the tariffs on Canada, Mexico and China proposed by the Trump administration present a new set of risks for export demand, especially the tariffs on Mexico given that country’s importance as a destination for both virgin and recycled containerboard exports from the US.
Want to learn more? You can access our expert forecast for the US kraft paper packaging market here.
The US economy is driven by consumers, and the rate of consumption is the key metric for US economic growth. Although gradually increasing through 2024, the continuing low levels of unemployment are supporting consumer demand, and record-high household net worth and a still relatively low debt service ratio indicate that the consumer economy is well-positioned for growth, despite purchasing power being damaged by high inflation.
US GDP growth peaked at 6.1% in 2021, boosted by the recovery from the deep pandemic-induced recession in 2020, then fell to 2.5% in 2022 and rose slightly to 2.9% in 2023. In this forecast, we anticipate that US real GDP will advance 2.4% in 2024, 1.7% in 2025 and 2.2% in 2026.
The Canadian economy has traditionally been driven by two key factors: commodities — particularly energy — and consumption. In 2020, the Canadian economy experienced significant deceleration due to the pandemic and the related drop in oil prices. Canada’s economy continues to operate at two speeds, with sectors linked to oil and other commodities accelerating and decelerating alongside oil prices while the rest of the economy performs at more consistent rates above or below the oil and commodities sector.
Overall, real Canadian GDP rebounded 5.2% in 2021, grew a further 3.8% in 2022 but a much slower 1.2% in 2023. In this forecast, we project that the Canadian economy will grow 1.9% in 2025 and 2.3% in 2026. We foresee Canadian GDP growing 1.9% per year on average in 2024-29 and 2.1% per year over the entire 15-year forecast period through 2039.
Interested in a deep dive? You can access our analysis of and predictions for the US kraft paper packaging market here.
Learn how to monitor packaging prices using cost and price indices and understand the underlying cost drivers, from material cost to labor, energy and more. Examples include cartonboard, liquid container and paper bag.