Carton Boards Market Research Report - Procurement Intelligence

Procurement Market Intelligence Report

Carton Boards – Procurement Best Practices & Sourcing Strategies

Cartonboard Market – Executive Summary, Market Analysis, Market Monitoring Insights, Industry Analysis, Procurement Best Practices, Impact of COVID-19, Purchasing Process: RFP/RFI Questionnaire, Supply Base Analysis, Negotiation Levers, Sustainability Initiatives, Innovations in Cartonboard/Folding Cartons

1. Executive Summary
1.1. Global Trends
1.2. Supply Market Outlook
1.3. Demand Market Outlook
1.4. Category Strategy Recommendation
1.5. Category Opportunities and Risks
1.6. Negotiation Levers
1.7. Talking Points
1.8. Impact of COVID-19
2. Market Analysis
2.1. Global Cartonboard Market Analysis
2.2. Global Cartonboard Market Growth Drivers
2.3. Global Cartonboard Price Drivers
2.4. North America Cartonboard Market Analysis
2.5. Europe Cartonboard Market Analysis
2.6. Asia and Saudi Cartonboard Market Analysis
2.7. Latin America Cartonboard Market Analysis
3. Market Monitoring Insights
3.1. Cost Structure Analysis
3.2. Commodity Price Forecast
3.3. Raw Material Price Forecast
3.4. Cost Analysis and Expected Savings
4. Industry Analysis
4.1. Porter’s Five Forces Analysis
5. Procurement Best Practices
5.1. Common Procurement Pattern
5.2. Contract & Payment Terms
5.3. Supplier Evaluation
6. Impact of COVID-19
6.1. Sourcing Location Watch
6.2. Supplier Watch
6.3. Industry Watch
7. Purchasing Process: RFP/RFI Questionnaire
7.1. RFP Builder
8. Supply Base Analysis
8.1. Key Global Suppliers
8.2. Key Regional Suppliers
8.3. Capacity Expansion Plans by Suppliers
8.4. Key Global Supplier Profiles
9. Negotiation Levers
9.1. Contract Negotiation: Best Practices
9.2. Contract Negotiation: Best Price Evaluation
9.3. Engagement Models
10. Sustainability Initiatives
10.1. Avenues for Sustainability in Cartonboard
10.2. Sustainability Initiatives
11. Innovations in Cartonboard/Folding Cartons
11.1. Technological Developments
11.2. Key Innovations in Cartonboard/Folding Cartons

What is the present status of the global carton board market?


According to a recent ELINT Market Research analysis, the global market has a capacity of 231 million metric tonnes and a demand of 187 million in 2023.


Which industry segment will likely take the lead in the carton board market?


The growing demand for sustainable packaging and environmentally friendly solutions in the rapidly growing food and beverage industry will propel this sector to a significant market share by 2023–2024.


What is the overall outlook for the carton board market across different regions?


Asia emerged as a major worldwide supplier with excess capacity, and significant companies control regional capacities.


Carton Board Market Size and Procurement Research Report


The statistics and trends in the carton board procurement research report reflect that the path of the carton board market is solid and promising. According to the most recent ELINT Market Research findings on market overview in 2023 (estimated), the report suggests that global capacity stands at a high level of 231 million metric tonnes (MMT), and the associated global demand is estimated at 187 MMT. These are proofs that underline the industry’s robustness to having high production capability that would overshadow the actual demand set and thus have a possibility to grow further and expand the market. The focus on food at home is more promising, indicative of a push in demand for packaging solutions from the food industry, including carton boards.


Another salient feature that adds to this upbeat outlook of the carton board market is recent research on consumer spending habits in the USA between 2021 and 2022. Consumers in the United States spent 12% of their disposable personal income on food expenditures. This allocation is strategically divided, with 6.5% dedicated to food at home and 5.5% for food away from home. This consumer behavior resonates well with the critical role of carton boards in packaging and shipping, thus further supporting the growth trajectory of the market as it caters to changing needs in the modern consumer environment.


Market Definition


Carton board is a flexible, solid paper-based material for diverse common uses, such as packaging manufacturing. It has a character of being rigid and stable, making it ideal for usage in forming boxes and cartons, among others. The properties of the carton board are prepared by the paper pulp layers that the packaging demand can characterize.


Carton Board Market Drivers


  1. Adoption of Sustainable Packaging: The rising trend in adopting global practices has fueled the demand for eco-friendly solutions, eventually driving demand for carton boards.


  1. Demand for Lightweight Packaging: Carton boards meet the requirement of a lightweight yet robust alternative to traditional packaging materials, namely glass, metals, and plastics.


Challenges of the Carton Board Market


  1. Volatility in Raw Material Costs: The market is subject to significant raw material cost volatility, especially paper pulp. The fluctuation in raw material prices can result in a spike in production costs.


  1. Regulatory Compliance: Regulatory compliance concerning packaging material is one of the challenges in the market.


Opportunities in the Carton Board Market


  1. Technological Advancement: Advanced manufacturing technologies can help increase efficiency and reduce costs in carton board processing.


  1. Customization: The market has drastically shifted toward personalization and customization of consumer preferences. Producers can tap the market with personalized packaging solutions.


Carton Board Market Segmentation


  1. Type: Market Segmentation according to the report covers Folding Boxboard, Solid Bleached Sulphate (SBS), White Lined Chipboard (WLC), and Coated Unbleached Kraft Board (CUK).


  1. Application: Market segmentation, according to the report of Market Research, will be Food and Beverage, Healthcare, Consumer Goods, and Industrial Packaging.


  1. Region: The research report identifies North America, Latin America, Europe, Asia-Pacific, the Middle East, and Africa as the prime geographical splits.


Regional Outlook of the Carton Board Market


The North American market is a net importer of carton board products and thus experiences an undersupply. Worth mentioning is the fact that significantly dominant players within North America are the top six, contributing 61% of the regional capacity share. Heading to Europe across the Atlantic is the nearly identical mirror image of the situation, with the region being undersupplied with the carton board products, presenting it as a net importer. The top five players in the European market affirm their dominance, as together, they hold a share of approximately 50% of the regional capacity.


On the other hand, carton boards are in oversupply in the Asian market, and the region thus exhibits a net export position for the product. Asia’s top 20 players collectively share about 41% of the capacity in the APAC region and are contributing to a more diversified and competitive scenario. It has resulted in an oversupply situation in Asia, where the region essentially acts as the vital caterer for global carton board demand, with a good portion of production sent to the international markets.

Impactful Cost Component in the Carton Board Market


The most prominent component remains the raw material, with a share of 65-75% of the total production cost in the market. It highlights the critical cost element that the industry depends on in the procurement and processing of raw materials and underlines its crucial role in shaping the overall cost dynamics within the market.


Pricing Models in the Carton Board Market


Pricing models in the market are specifically applied when determining how the products are priced in general, within which the critical indices are determinants for such an end. In this regard, two well-established indices are RISI and EUWID, which are within the industry and are usable as a basis for price definition. These indices, therefore, offer the market players reliable indicators to obtain price points that reflect the prevailing market situation with the assurance of a transparent and uniform pricing strategy approach.


Cost Structure of the Carton Board Market


Raw material costs represent 64.1% in North America, labor is 8.8%, 7.1% pertains to energy, and 19.7% goes to other expenses. In Europe, raw material costs represent 63%, labor 8.5%, energy 19.3%, and other expenses 9.4%. On the other hand, raw materials stand for 77%, and labor is responsible for 3.2%, whereas, in the Asia Pacific region, labor amounts to 3.2%, with energy and other costs taking 16.9% and 6%, respectively. It further emphasizes diverse regional cost structures other than the others, and business strategies need to align with the market’s respective economic and resource landscape.


Contract Period of the Carton Board Market


It is an essential driver as prices in the market operate on a contract period, with 65-75% of the cost usually linked to an index—often based on pulp or OCC prices—typically every quarter. Most contracts in the market are one to three years. It strikes a balance between stability for both buyers and sellers, as changes are in force with reaction to evolving market conditions, and long-term relationships are encouraged in the industry.


Payment Terms in the Carton Board Market


Notably, payment terms applied in the market substantially impact the business relationship. Standard payment terms in the market for the industry involve 60 and 90 days as payment terms. However, with a consolidated procurement model and enough buying volume, buyers can use the extended payment terms of 120 days. It thus allows flexibility to meet varying business needs and strengthens mutually beneficial partnerships within the market.


Leading Players in the Carton Board Market


Key companies in the carton board market include United States Steel Corp, ArcelorMittal USA LLC, Steel Dynamics Inc, AK Steel Corp, Evraz Plc., Tata Steel Europe, Gerdau SA, CSN – Companhia Siderúrgica Nacional SA, Hesteel Group, Nippon Steel and Sumitomo Metal Corporation, Jiangsu Shagang Group Co. These players bring forth their collective expertise to shape the industry through innovation and efficiency.

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