The corrugated cardboard industry continues to produce at high pressure under extreme conditions. Rising paper and energy prices are putting pressure on the industry. However, the German Association of the Corrugated Board Industry (VDW) explains that supply bottlenecks are to be avoided in the run-up to Christmas.
Paper prices have been skyrocketing for months. The corrugated cardboard industry has also been hit by significant energy price increases. At the same time, it is producing at full speed in order to fulfil the wishes of its customers despite all the challenges. With a view to the Christmas business in particular, both manufacturers and customers are focussing as much as possible on the current exceptional situation on the market explains the Verband der Wellpappen-Industrie e. V. (VDW).
„Corrugated board is becoming increasingly popular as an environmentally friendly packaging material - which is actually a very positive development. Nevertheless, our industry is currently coming under increasing pressure, particularly due to the never-ending price increases for our most important raw material, paper.“ Dr Steffen P. Würth, VDW Chairman
The corrugated board industry has already been confronted with an increasingly dramatic development since September 2020: „According to VDW calculations, there was a decline in waste paper-based corrugated base paper from September 2020 to September 2021. a price increase of 57.7 per cent“, emphasises Würth. This value is a key indicator for the industry because corrugated board packaging consists of an average of 80 per cent recycled material.
However, the weighted overall price level for corrugated base paper, which takes all grades into account, was also expected to rise from September 2020 to September 2021. Plus of 51.3 per cent a significantly higher cost burden were recorded. According to the economic service Euwid, there were even greater spikes for individual paper grades: For example, the price of corrugating medium climbed by 71.4 per cent in the period from September 2020 to October 2021.
The extremely difficult situation for manufacturers is linked to the economic after-effects of the pandemic. During previous lockdown phases, less waste paper was collected from commercial suppliers, which led to a shortage and an increase in waste paper prices. The corrugated board industry is also experiencing additional pressure due to Steep upward curves in energy pricesAccording to the Federal Statistical Office, gas prices rose by a whopping 159.7 per cent between August 2020 and September 2021. The price of light heating oil rose by 84.9 per cent between September 2020 and September 2021.
With a view to the approaching Christmas business, VDW Chairman Würth assures: „The corrugated board industry is producing at a permanently high capacity in order to meet the strong demand. Our industry is doing everything it can to supply its customers as quickly as possible and Avoiding bottlenecks in the Christmas business.“ Packaging for this seasonal peak phase is usually ordered several months in advance.
However, the current market situation in various areas - not just paper - is characterised by raw material shortages, that many customers had already adjusted their ordering behaviour and acted earlier. „All sides are therefore trying to adapt as well as possible to the current exceptional situation,“ says Würth. The extreme cost pressure to which the corrugated board industry has been exposed for many months now, does not pass them on to the customer to the extent that is actually economically necessary, emphasises the VDW Chairman. This is clearly reflected on the revenue side: the VDW calculated average revenue per m² of corrugated board rose by just 10.3 per cent between September 2020 and July 2021. „Measured against the explosion in paper costs and the rise in energy prices, we are therefore in a drastic imbalance,“ summarises Würth.
SourceVDW : VDW
