Fortunately, it's not your father's brown bag business anymore.

In fact, after an extended period of lackluster sales that had all the "excitement" of one beige corrugated case after another, US demand for corrugated and paperboard boxes is set to climb a respectable 2.1 percent a year to nearly $35 billion in 2009. That projection, from a new study by Cleveland-based market researcher The Freedonia Group, Inc., is a distinct rebound from the weak growth of only 0.6 percent a year during 1999–2004.

Advances will be fueled by an increase in manufacturing activity, especially an upswing in non-durables shipments, which accounted for more than three-quarters of total box demand last year. Value gains will also be built on higher-quality printing and graphics on boxes, as packagers and their converters continue to focus on aesthetics as a means of competing with alternative packaging materials. Changes in the retail environment, including the rise of warehouse club stores, are requiring corrugated cases as well as folding cartons to improve their appearance and act as billboards for their products. (See Market Trends, Dec. 2005, p. 4).

Expect corrugated and solid-fiber boxes to see the best opportunities for growth, the report predicts, with sales reaching $24.1 billion in 2009 (see chart, top right). Annual growth is forecasted to be 2.3 percent compared to the miniscule 0.5 percent during 1999–2004. Low cost and recyclability are the chief advantages helping corrugated boxes maintain market share despite competition from reusable plastic containers for some markets. Additional sales drivers are SBS linerboards for high-quality printing, and mini-flute constructions for smaller cases.

US demand for folding cartons will increase modestly through 2009—up 1.7 percent a year, Freedonia says, but gains will be restricted by strong competition from alternatives such as flexible packaging in the form of standup pouches. On the plus side, cartons will benefit from printing advancements along with a positive environmental image.

The picture's not so rosy for the setup box category as demand will keep declining—down 1.3 percent a year, Freedonia predicts (see chart, bottom right). Product makers will keep seeking lower-priced alternatives to setup boxes, although the package will maintain strong for jewelry and confectionery items.

Expected to account for more than 40 percent of corrugated and paperboard box demand in 2009, retail foods will remain the largest end-use market. Key categories will be beer and soft-drink carriers and packaging for dairy and fresh produce, the report says. Boxes for chemical products are also forecasted to see healthy growth because packagers of pharmaceuticals, cosmetics and toiletries will focus on high-value cartons for marketing aspects. Other strong prospects include boxes for machinery, software products and carry-out food. The fastest growing market for corrugated cases will be retail shipping as the popularity of Internet shopping continues to expand.