At least four uncoated recycled paperboard producers are raising prices in the latest wave of fiber price increases. Meanwhile, overall containerboard and boxboard pricing again remained flat in March, according to a leading index, but tariffs appear to be affecting demand.
Sonoco led the charge for URB price increases with its March 10 announcement of a $70-per-ton price hike in the United States and Canada effective April 10. The company also announced a minimum 8% increase on converted paperboard products — including tubes, cores, cones, partitions, protective packaging and other specialty products — as of April 15. Greif followed suit on March 18, disclosing a hike of $50 to $70 per short ton of URB starting April 21, and at least a 7.5% increase on tube and core and protective packaging products as of April 28.
Then, Cascades joined the pack on March 19 with a $70-per-ton price increase on URB as of April 21, according to Michael Roxland, Truist Securities senior paper and packaging analyst, who cited information from Fastmarkets RISI. Private company Ox Industries also announced a URB price increase for April, he said.
Cascades did not offer reasons for the URB price bump, according to Roxland. Greif said theirs was due to increased manufacturing costs, and Sonoco cited “continued inflation in input costs and tightening market conditions.” Greif further explained that the price hike for tubes and other products is because URB is the primary material used for manufacturing those items.
Greif and Sonoco also announced URB price increases last summer. The new hikes follow the wave of increases for other grades that producers announced would take effect earlier this year. More than a dozen containerboard producers announced price increases for January, typically of $60 to $70 per ton for linerboard and $80 to $90 per ton for medium.
On Friday, Fastmarkets RISI released its weekly Pulp & Paper Week publication, which included monthly fiber pricing information for March. Pricing remained flat for both containerboard and boxboard, according to a Sunday evening note to investors from Roxland.
PPW’s monthly data in January showed no price movement, and in February, it charted only a partial increase: $40 per ton for containerboard but no change for boxboard. This activity mirrors the trend last year, when producers began 2024 with price increase announcements but underwent subsequent attempts to account for the lack of full recognition by the index.
During their earnings calls last month, neither Sonoco nor Greif executives delved deeply into tariffs discussions, although they described conducting analyses to determine potential effects and devising impact mitigation plans. But some analysts are pointing to effects that already occurred to demand in the fiber space, which could also influence pricing.
Some Fastmarkets RISI contacts cited tariff uncertainty as a reason for softening demand, and some customers pulled back on orders already placed for March or April, Roxland explained. He noted that the data suggests containerboard demand appears to be mixed or lower, with February’s four-week mill backlogs reported to have shrunk to four weeks or less in March.
However, there are also signs of a containerboard demand rebound as customers build inventories, “with some contacts selling out as customers order ahead of tariffs,” Roxland said. Some contacts also anticipate that higher prices for food and consumer goods, driven by tariffs, could spur another price increase for linerboard and boxes, possibly in May or June.
Boxboard demand also shifted because of tariffs, Roxland explained. Coated recycled board largely was unchanged in March, although some contacts reported a slowdown in February and March after customers built up their inventories in January to get ahead of tariffs.
In February 2024, Sonoco announced that it would close its URB mill in Sumner, Washington. In January, Greif announced closures that included a URB mill in Fitchburg, Massachusetts. And last month, International Paper announced that it would close several facilities, including its Red River containerboard mill in Campti, Louisiana.
If another large integrated producer announces capacity reductions on top of those, supply could tighten, Roxland said, which could support further price increases. Additional cost inflation also would support such increases.
The containerboard industry is experiencing an oversupply, and the expectation is for more closures and capacity reductions in the coming months, said Ryan Fox, corrugated packaging market analyst at Bloomberg Intelligence, during a February interview about that month’s fiber prices.
Closures change companies’ operating rates and “help them rationalize some of their financials,” Fox said. “But if they want to raise prices, they can really do that at any point in time.”
