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Key takeaways
Keeping on top of paper packaging prices is no easy feat. Prices can easily be influenced by many factors, from the supply and demand trends to the cost to produce your product. In addition, macroeconomic influences such as inflation, geopolitical events, supply chain challenges and policy changes can also have an impact on prices.
In this article, we will take you through what makes up the cost of a paper packaging product and demonstrate how the price of your product can change quickly over time using price and cost indices.
To simplify, the cost to produce paper packaging can generally be separated into three broad categories:
The largest and most variable cost for producing paper packaging is in the paperboard material that makes up the bulk of the product. Changes in the value of the paperboard material can be estimated by using:
By modelling the market price of the paperboard and the cost to produce the paperboard, we can work out how paper packaging prices should evolve over time.
Our index builder model calculates how the cost of producing the paper packaging should have evolved in relation to the changes in the two factors mentioned above – the market price of the paperboard material using our price data (the price index) and the cost to produce the paperboard material based on information from our cost benchmarking tool, Analytical Cornerstone (the cost index).
In our example, we will demonstrate the volatility in prices and costs by focusing on the cost evolution of corrugated packaging in Europe using two types of containerboard – recycled liner and recycled medium – as the paperboard material and a starting point of EUR100 per 1000 pieces from 2023 to 2025.
Firstly, the model shares a chart that demonstrates how the cost to make the corrugated box has changed based on the market price of the containerboard base material.
It shows that containerboard prices had steadily increased from Q4 2020 and peaked in Q2 2022 at €165.95 per 1000 boxes, with both recycled liner and recycled medium almost doubling in price compared to 2020. The prices somewhat held on through Q3 and fell very quickly again from Q4 onwards, dropping to only €124.54 per 1000 boxes in Q1 2023.
Since then, prices have risen overall following a small dip at the start of 2025.
The peak in prices in early 2022 was driven by a tight market where the demand for all grades was strong and mills tried to secure limited supply. This had eased in the latter part of the year with a combination of soaring inflation, weakened demand, uncertainty surrounding the war in Ukraine and the prospect of an energy crisis driving the downward trend in prices.
In 2025, uncertainty over tariff announcements has led to fluctuating prices as various tariff rates have been announced and changed while the US and EU negotiated a deal. In January 2025, containerboard prices dipped to a low of €121.47 per 1000 boxes.
The next chart produced by the model demonstrates how the cost to make the corrugated box has changed based on the cost to produce the containerboard base material. The model takes into account the main cost drivers in a containerboard mill, including fiber, energy, labor, chemicals and others.
The cost to produce the containerboard has increased significantly over the last five years, peaking in Q3 2022 at €287.43 per 1000 boxes. However, that U-turned dramatically in the next quarter and dropped to just €221.72 per 1000 boxes, just over double the cost from the start of 2020.
So far in 2025 prices have been moving up again, rising to €205.75 per 1000 boxes in Q2 2025.
The main contributors to the dramatic rise and fall in production costs were identified to be energy and fiber. We can delve further into the model to find out what happened here.
Here the model focuses on how energy prices had evolved in this time period and takes into account nine different types, including biofuels, coal, electric, natural gas and others.
At its peak in Q3 2022, the cost had gone from €30.86 to €139.68 per 1000 boxes. The biggest contributor was natural gas, which had seen its cost grow by almost fivefold since 2020. However, by Q4 2022, energy has dropped to €121.68 per 1000 boxes and natural gas has reduced to just over four times the cost compared to 2020.
Natural gas prices have been steadily rising, with prices 18% higher in Q2 2025 compared to Q2 2024. This reflects the nature in which European paper packaging companies are heavily dependent on natural gas to power their mills. Overall, the cost of energy has inclined to €69.05 per 1000 boxes, up from €58.20 in Q2 2024.
When prices shot up significantly in 2022 due to inflation and the war in Ukraine, it drastically increased the production costs of paper packaging products. Energy prices have lowered and stabilized since the peak of the energy crisis, resulting in the drop in production costs that occurred in 2023 and reduced volatility since then through to Q2 2025.
On the fiber side, the model takes into account four different types of fiber, including old corrugated containerboard (OCC), mixed paper and board (P&B), liquid board packaging and double-lined kraft corrugated cuttings (DLK).
Changes in OCC prices are the main contributor to movements in the overall fibre cost.
Fiber cost leaped in the first half of 2022 and had increased more than fivefold from €15.24 in 2020 to €86.39 per 1000 boxes in Q2 2022. The slump in fiber costs came abruptly in the next quarter, with the overall cost dropping to €36.32 per 1000 boxes and OCC prices reducing to only +131% from 2020. This downward trend continued until Q1 2023 before prices began to show signs of significant volatility.
Between Q1 2023 and Q3 2024 prices were consistently on the rise, increasing from €45.58 to €96.91. From there prices dropped until Q2 2025 when costs peaked again to €103.07. The peak represents a 51% jump in Q2 compared to the previous quarter.
The last chart from the model brings together the cost and price indices.
It shows that the cost to produce containerboard had risen more than the market prices at which the containerboard had been sold in Q2 to Q3 2022. The largest difference between the two indices was in July 2022, when the cost index was at approximately +287% while the price index was at approximately +161%. At this point, integrated box producers’ margins were squeezed as the input costs were high.
The markets turned very shortly after and both the cost and price indices had started to go on a downward path by Q3 and Q4 2022, thus easing cost pressures for producers.
From 2023, the difference between the cost and price indices has been much smaller, but the data for Q2 2025 is showing signs that they may diverge again.
These insights demonstrate the volatility in our markets today, and also points out why it is imperative for all players in the market to keep on top of the fluctuations in prices and their drivers.
The outlook for the global economy has been unpredictable for most of 2025, with the threat of tariffs looming over the US’s main exporters. Additionally, rising geopolitical tensions and the uncertainty surrounding supply and demand conditions for paper packaging have left many businesses unable to make informed decisions on their supply chains.
Our index builder model is a useful tool for you to monitor these changes and understand how prices could evolve. It combines our trusted and benchmarked price data with our industry-leading mill intelligence database and allows you to set up the model to closely resemble your ‘real-life’ scenario. This can provide you with insights into what factors are influencing the price of your paper packaging product, bring more transparency to your supplier/buyer relationship, help you justify prices at the negotiating table and make sure you are paying the right price for your products.
Speak to our team to schedule a demo or find out more about how our cost analysis products can help you.
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.