Paper Products Manufacturers

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 2,100 companies in the US manufacture paper products by cutting, shaping, coating, or laminating paper and other materials. End products are often referred to as converted paper goods. Product categories include paperboard containers, paper bags, coated and treated paper, stationery products, and sanitary products.

Variability in Raw Materials’ Costs

The paper industry is cyclical and cost of wood pulp (primary material in paper manufacturing) can fluctuate depending on global supply and demand.

Competition from Imports

Imports of converted paper products have grown at a healthy rate over the last decade.

Industry size & Structure

A typical paper product manufacturer employs 117 workers and generates $57-58 million annually.

    • The paper product manufacturing industry consists of about 2,100 companies that employ about 272,500 workers and generate $123 billion annually.
    • The 50 largest firms account for 62% of industry revenue.
    • Some large companies are vertically integrated and own paper mills.
    • Large companies include Kimberly-Clark, WestRock (formerly RockTenn and MeadWestvaco), and Amcor (Bemis Company).
                          Industry Forecast
                          Paper Products Manufacturers Industry Growth
                          Source: Vertical IQ and Inforum

                          Recent Developments

                          Apr 4, 2024 - Slower Industry Growth
                          • The paper product manufacturing industry is expected to experience weaker sales growth in 2024 after a slight improvement in demand in 2023. The industry’s year-over-year sales growth declined to -1.7% in 2020, then rose to 8.8% in 2021 before falling to 2.3% in 2022, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth rose 2.6% in 2023 and is projected to moderate to 0.8% in 2024, then see steady average annual growth of about 1.7% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
                          • In early March, British paper and packaging firm Mondi reached an in-principle deal to acquire fellow UK paper producer DS Smith in an all-share deal that valued DS Smith at 5.14 billion British pounds, according to Reuters. About three weeks later, US-based International Paper (IP) made a counter all-stock takeover offer for DS Smith, which valued the UK firm at 5.8 billion pounds. The IP offer would give DS Smith shareholders a 33.8% stake in the combined company. In mid-April, DS Smith accepted IP’s offer, marking a continued consolidation in the global paper and packaging industry. In September, US packaging firm Westrock agreed to be acquired by Ireland-based Smurfit Kappa, which would create a new firm, Smurfit Westrock. The new company will be headquartered in Ireland and have estimated revenue of $34 billion. The Westrock- Smurfit Kappa deal is expected to close in early July 2024, according to Packaging Dive.
                          • Total US printing-writing (P-W) paper shipments dropped 1% in February 2024 compared to the same month in 2023, according to the American Forest & Paper Association (AFPA). Uncoated free sheet shipments were flat in February compared to February 2023, while coated free sheet shipments increased by 5%, and shipments of mechanical paper declined by 17%. Shipments of packaging papers and specialty packaging papers increased 5% in February over the same month in 2023.
                          • Industry watchers suggest that demand is improving for paper packaging and tissue markets, according to Resource Recycling. By 2035, a global increase in paper packaging production is expected to drive demand for an additional 77 million short tons of recovered fiber, according to market research by AFRY Management Consulting. Boosted by resilient consumer spending and brand owners’ investments in sustainability goals, AFRY projects that corrugated packaging demand in the first quarter of 2024 will surpass year-earlier levels. The tissue market is also expected to post steady growth as demand from the restaurant and travel markets pushes out-of-home tissue production back to pre-pandemic levels.
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