The Chinese boxboard industry has increased its production over the last decade, changing its trade deficit to a surplus that exceeded 1 million tonnes in 2014. However, this growth has proven disruptive to key virgin boxboard exporting regions like North America and Western Europe, according to a report – World Boxboard Study – from analyst firm Risi.
Dustin Jalbert, Economist of Packaging Paper at RISI and the lead author on the study, explains: “Investment has been particularly concentrated in virgin boxboard grades over the last five years—bolstering capacity of these grades. Chinese suppliers are capturing commodity boxboard markets in nearby regions, placing competitive pressures on North American and European virgin boxboard suppliers dependent on exports for continued growth. The glut of boxboard from China has understandably raised concerns over new European projects coming on line over the next two years and how this capacity will be absorbed into market.”
The report includes regional cost curve and pricing analysis and the impact of the Chinese overcapacity on other regions. More details from risi.com.