In 2022, The Demand For Color Boxes Will Exceed The Supply, And The Extraordinary Demand For Carton Boxes Will Ease!

In 2022, the demand for color boxes will exceed the supply, and the extraordinary demand for carton boxes will ease!

According to experts, the demand for folding cartons could grow by nearly 5% by 2022, while the supply side is still struggling to keep up. According to NOA paper packaging industry analysts, there are signs that demand for folding color boxes in the European market will grow by 4.9% this year (compared to 3.7% in 2021), with nearly 2% of the increase due to the substitution of plastics. .

"Ironically, this green wave is partly driven by increased demand for plastic," said NOA managing director Neil Osmond. "When the COVID-19 pandemic first hit, many of us were Shopping at home, most of our food is wrapped in plastic. Food and beverage producers are already exploring switching to paper, a trend that accelerated when demand for plastic rose.”

In the UK, the plastic tax (on any plastic packaging that does not contain at least 30% recycled plastic) from April 1 is also likely to increase demand for paper packaging as brands and manufacturers shift.

In addition, corrugated boxes are also in high demand, although the growth rate of corrugated boxes will start to slow down in the first few months of 2022. In the UK, demand for corrugated boxes surged by 10% in 2021, before falling back to 2% after work-from-home rules were eased over the summer. The performance of other European countries is basically similar. Corrugated box demand in Germany, France, Italy and Spain all saw significant growth in 2021, but the pace of growth also slowed in the summer of 2021 when hybrid work arrangements became more common.

"There appears to be a direct correlation between working from home and increased demand for corrugated boxes, which is clearly driven by e-commerce," Neal said. "This demand for e-commerce packaging has decreased significantly since home working restrictions were eased, but in the past In the four or five months of 2021, demand across Europe remains on an upward trend of around 2% until the end of 2021. The situation eases in 2022, but demand remains significantly higher compared to 2020.”

Neal attributed the near-term lull in demand to an unusual 2021. Corrugated box demand has declined in the first two months of 2022 compared to 2021, but at the beginning of 2021, Brexit factors have caused supply chain congestion, strong demand and excess orders. Compared to January/February 2020, the demand for corrugated boxes still maintains a healthy growth of 2%-3%.

In 2022, the pattern change from working from home to working in an office three days a week (a trend known as TWT – Tuesday, Wednesday, Thursday) eases demand for e-commerce corrugated boxes. Destocking, inflation and the effects of the war in Ukraine also played a role in the process. Paper mills and carton mills have been struggling to meet market demand for the past 6-9 months, which was exacerbated last year when there was a shortage of waste paper and virgin fibers in some places. Before the pandemic, waste paper recycling rates in the UK and continental Europe were around 85%, but have recently dropped to 65%.

"It's clear that not every household can effectively recycle cardboard waste," Neal said. "Some waste ends up in landfills, some remains in the home indefinitely, and some may end up in landfills." Hoarding for a few weeks before putting it in the recycling bin. All of this means that a significant portion of paper waste takes longer to re-enter the recycling supply chain.”

In the UK, each household is thought to hold an average of seven cardboard boxes. For 28 million households, this equates to about 50,000 tonnes, or 15%-20% of the annual output of the world's largest paper mills. New waste collection systems in the UK and across Europe should help improve the recycling process for waste paper. Now, the capacity of some recycled cardboard mills in the European folding box market is under pressure, while the war in Ukraine is putting pressure on the continued supply of virgin pulp and kraft paper.