New York, NY (PRWEB) March 14, 2014
Subdued industrial production and mounting competition from imports have harmed the performance of the Cardboard Box and Container Manufacturing industry over the five years to 2014. Industry products include corrugated and solid fibre boxes, folding paperboard boxes and other assorted converted paper items, which are ubiquitous in domestic packaging. The industry is highly dependent on the manufacturing sector for demand, particularly on food, beverage and agricultural producers. “Given the nondiscretionary nature of their products, food and beverage manufacturers have continued to provide a relatively stable source of demand for industry operators,” according to IBISWorld Industry Analyst Stephen Hoopes. Yet, sales to the manufacturing sector as a whole have declined in recent years due to the long-term trend of offshoring manufacturing operations to low-cost countries that also provide access to emerging markets. Consequently, industry revenue is expected to decline at an annualized rate of 3.4% from 2009 to 2014 to reach $4.3 billion; this decrease includes a 2.1% drop in revenue anticipated in 2014 alone.
Moreover, cardboard box and container manufacturers continue to face escalating competition from imported corrugated products, particularly those sourced from the United States and China. Over the five years to 2014, the total value of imports is anticipated to increase at an annualized rate of 7.0%, with imports now accounting for over one-fifth of domestic cardboard use. “Meanwhile, export sales are expected to decline at an annualized rate of 2.6% over the same period, reflecting continued weakness in overseas markets, declining domestic production and the continued appreciation of the dollar,” says Hoopes.
Over the five years to 2019, revenue is forecast to continue to fall. Industry operators will find it necessary to contend with declining downstream production, especially food and beverage manufacturing, which is set to decline as a share of GDP over the five-year period. Moreover, competition from substitute products is anticipated to intensify, with flexible packaging expected to increasingly replace rigid packaging due to its lighter-weight characteristics. Yet, not all trends are anticipated to damage the industry's performance.
For more information, visit IBISWorld’s Cardboard Box and Container Manufacturing in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry includes companies which primarily convert purchased paper, paperboard and old corrugated containers into cardboard boxes, containers and similar packaging. The industry produces corrugated and solid cardboard packaging for a range of industries, including manufacturing, agriculture, wholesale, shipping, retail and others.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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