One of the ways you can check on the pulse of the US economy is to look at production and consumption of the “Good Ol' Corrugated Shipping Case.” Being such a basic form of bulk packaging for so many products, its use—or lack thereof—can reveal quite a lot.

So, along those lines, the latest forecasts from Cleveland-based market researcher The Freedonia Group, Inc. (www.freedoniagroup.com) seem to show that a potential US recession this year will definitely temper demand for corrugated and paperboard boxes.

Overall, sales are expected to rise 2.5 percent annually through 2012 to $39.9 billion. That rate is down slightly from 2.7 percent a year for the 2002-2007 period. 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, Freedonia says.

Sales of corrugated and solid fiber boxes, which accounted for more than 70 percent of demand in 2007, will reach $28.8 billion in 2012—up from $25.2 billion last year (see chart). Growth will be based on their well-entrenched position as low-cost shipping containers in virtually all manufacturing sectors—as previously mentioned. Demand will also be supported by the good environmental profile of corrugated boxes, which will become increasingly advantageous as interest in sustainable packaging rises. 

Pouches vs. cartons

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 flexible pouches and bags, clamshells and blister packs, Freedonia predicts. Nevertheless, folding carton sales will be supported by advances in combination-inline 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, perfume and cosmetics applications.

Food and beverages will remain the largest market for boxes, accounting for more than 40 percent of demand in 2012, Freedonia reports. Favorable growth fields: beverages, meat products, fresh produce and frozen foods as well as pharmaceuticals and cosmetics/toiletries. In the durable goods area, the best prospects will be in medical and other instruments, and entertainment and software products. Faster box growth in nonmanufacturing 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.