Sri Lanka corrugated carton industry pressured by rising paper prices

Sri Lankan corrugated carton industry faces headwinds over rising prices of paper

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corrugated carton
Sri Lankan carton industry facing increasing price of paper

The corrugated carton industry in Sri Lanka faces pressure and unprecedented challenges as the global prices of all types of papers continue to skyrocket since October last year, the Lanka Carton Corrugated Manufacturers‘ Association said recently. 

Many corrugated and brown box manufacturers are going through the most challenging situation in the industry’s history. The Lanka Corrugated Carton Manufacturers’ Association and its member’s fears are growing as it’s a prolonged period of extraordinary high prices with no signs of easing anytime soon.

The brown kraft liner and brown recycled grades, including testl iner, and corrugated medium papers, are expected to rise. During the last four months alone, prices have gone up by as much as over 50%, the Association said. 

It comes in the wake of a drastic shortage in paper due to the pandemic coupled with disruptions in supply chains, including costly freight charges. Further, there has been a significant rise in demand for papers from China to meet its domestic needs following the country’s ban on importing all wastes from various countries, mainly direct recovered paper, from earlier this year. 

This resulted in Chinese paper mills importing recycled brown pulp and recycled and unbleached Kraft linerboard to use it as a pulp or a fiber source to produce paper, apart from counting on other sources such as local recovered paper within the country, imported recycled as well as virgin pulp.

The Lanka Carton Corrugated  Manufacturers’ Association said that the recent second wave of coronavirus in the EU and the US is taking its toll in these countries, which has affected waste paper collection, leading to problems in its availability and rise in prices. 

Sri Lanka’s total carton production stands at 150,000 metric tons annually, primarily serving the B2B market. More than 40 corrugated carton manufacturers and about ten of them make up a whopping 70% plus market share. Today, many manufacturers are equipped with fully-automatic, state-of-the-art plants with an appetite to continuously invest in innovation, research, and development to increase the quality, consistency, and durability of their cartons.

“Needless to say, corrugated box manufacturing is an eco-friendly industry recycling brown boxes as well as waste paper. And it certainly deserves various avenues and opportunities to sustain and thrive in its operations, and this is a critical moment for key stakeholders, authorities, and officials to step in and help support the industry,” it said.

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