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Fastmarkets RISI Outlook Report Cautiously Optimistic For Folding Carton Demand Fastmarkets RISI recently released its 2024-25 Trends Industry Outlook & Market Data Report exclusively for the Paperboard Packaging Council (PPC), providing an in-depth analysis of the U.S. and Canadian folding carton markets. The report offers valuable insights into key trends shap- ing the industry, covering the impacts of the COVID-19 pandemic, infla- tion, and shifting consumer behaviors. The report highlights how the folding carton market experienced un- precedented growth during the pandemic. As lockdowns pushed con- sumers to spend more on goods rather than services, demand for folding with a 5.6 percent annual rise in shipments. However, as the world began returning to normal and consumers shifted their fo- cus back to services like dining and travel, inventory destocking followed. This led to a cooling in carton shipments, which fell by 2.4 percent in 2023. Despite this, the report forecasts that the fold- ing carton market will stabilize by the end of 2024, with shipments still expected to be 6.7 percent higher than pre-pandemic levels. The outlook for the coming years remains cautiously optimistic. Over the next five years, folding carton demand is expected to grow at an average annual rate of 1.1 percent, reaching 5.5 million tons by 2028. This growth will be driven by several key factors, including a rebound in nondurable goods production, which is forecasted to expand by 1.6 percent annually. Additionally, shifting consumer spending patterns, with increased demand for sustainable packaging solutions, will fuel this growth. In particular, consumers are increasingly favoring paperboard packaging over plastic alternatives due to environmental concerns, a trend that is expected to continue over the forecast period. The report also delves into the performance of specific end-use mar- kets for folding cartons. It identifies nine markets poised for notable growth, including food products, beverages, cosmetics, pharmaceuti- cals, and household supplies. These growth markets are expected to see more than 1 percent annual growth. In contrast, other markets, such as certain processed food categories, may face challenges due to chang- ing consumer preferences and cost pressures. Nevertheless, the report underscores that, overall, folding carton demand is likely to experience steady growth across most sectors. In the Canadian market, the report shows that folding carton ship- ments experienced three consecutive years of gains from 2020-22, driven largely by increased consumer spending and higher industrial production. However, 2023 saw a slight decline in shipments by 1.3 per- cent, largely due to slowing consumer spending in key sectors. Despite CONTINUED ON PAGE 14 cartons surged, particularly for nondurable goods. This result- ed in a significant 11.6 percent increase in shipments between 2019 and 2022. The peak occurred in 2022,
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November 4, 2024
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