Corrugation Sector: The E-commerce Backbone
Corrugated boxes have been the backbone of e-commerce and facilitate transport of anything from books to frozen fish around the world. Pamela Kokoszka finds out what trends are shaping this market and what machinery requirements are needed in order to make the boxes
The number of corrugated boxes is expected to increase by an average of more than 4% annually over the next five years, amounting to almost 115 million tonnes of converted material worth an estimated $176bn by 2019.
Corrugated paper is made from two simple ingredients, air-pocketed paper and glue made from wheat or maize. This means that corrugated boxes are harmless to the environment and if they end up in the ocean, they will biodegrade within two months, unlike plastic. Corrugated paper packaging is 100% recyclable and fibres can be reused up to 25 times.
It is made up of 88% recycled content with additional fresh fibres coming from sustainably managed forests. Corrugated paper packaging is extremely versatile. It can be made into any shape or size — anything from colourful boxes for safeguarding fast-moving consumer goods, such as chocolates, to trays for taking care of fragile fruit. It is also the ideal material for other purposes too, including furniture, exhibition stands, and even housing insulation.
The sustainability and environmental effect
While some packaging materials are denounced as problematic and harmful to the environment, corrugated is the natural bio-based and biodegradable alternative to fossil-based products.
Luis Christophe, EMEA Corrugated Segment Marketing Manager at HP said: “Corrugated is economical, delivers great value from protection to conveying messages, and contributes to environmentally friendly packaging efforts given many corrugated boards are made of recycled paper. Additionally, due to its lightweight, corrugated is an affordable packaging option as it often saves on transportation and shipping costs.”
While corrugated boxes are 100% recyclable, cardboard cannot be recycled indefinitely. The fibres in the cardboard get shorter every time the boxes are recycled. After five to seven recycling loops, those fibres become too short to bond together into cardboard. In order to reuse any remaining usable fibres and incorporate them into a new product, new fibres need to be added.
While corrugated boxes are 100% recyclable, cardboard cannot be recycled indefinitely
Despite this, some experts say recycling alone will not be enough to keep considerable amounts of cardboard out of the waste stream, and ultimately, US landfills. With two in three British people being concerned about packaging, where it comes from and where it ends up, responsibility for addressing and improving the UK’s record on packaging lies with food and drink manufacturers, government, and packaging suppliers.
Beyond the Box spokesperson, Andrew Barnetson, said: “Interest and concern about the UK’s packaging supply chain have never been higher. This new report from Beyond the Box shows packaging is a subject which has shot up everyone’s agendas. Britons are changing the way they shop and make purchasing decisions, major high street retailers are reducing their use of single-use packaging, and the Prime Minister has vowed to eliminate the UK’s avoidable plastic waste by 2042.
“Our research shows that no type of packaging is immune from criticism, so it is vital that we help to inform the debate. There is a fantastic opportunity for a sustainable, renewable and recyclable material like corrugated cardboard to play a leading role in helping consumers, government and industry reach exacting targets that are being set to improve the UK’s record on – and ultimately ease consumer concern about – packaging.”
Corrugated cardboard naturally ensures fruit and vegetables stay fresh for longer, while the delicate produce is cushioned between the layers of paper preventing food waste. A 2016 study by the University of Bologna showed corrugated board keeps fruit fresh up to three days longer by reducing contamination.
Trends and challenges facing the market
Lightweighting of corrugated paper has been affecting the industry for quite some time now. Rightweighting and rightsizing are new trends playing an important role in the corrugated box market. Customers expect their packages to come in boxes appropriate for the content, but the trend is also a response to the logistics chain’s adoption of dimensional weight (DIM) pricing.
Chiara Covone, Divisional Innovation Director at DS Smith said: “One particularly big challenge for the industry is the issue of void space. On average 55 per cent of each box shipped is empty because of the infinite combination of products purchased online and the finite number of packaging solutions. Shipping air is a waste of money that no company can afford.”
Companies and researchers continuously look for ways to improve corrugated boxes. For instance, Bestack and a research group at Bologna University have developed packaging, which increases the shelf life of products thanks to controlling the proliferation of microbiological organisms.
Bestack’s active corrugated cardboard packaging uses the same essential oils present in nature, which are already in use in the food industry, as approved by the legislative framework. This is in order to control the ripening process and to slow it down in a natural way.
Lightweighting of corrugated paper has been affecting the industry for quite some time now
Nathalie Schneegans, communications director at FEFCO said: "In 2016, Bestack active packaging has been tested directly at selling points producing exciting results. Product shelf life was increased by 1.6 days in comparison with traditional packaging, the ripening process was regulated, allowing for the fruit to be picked up as near as possible to the time of optimal ripening, The likelihood of product waste is reduced, allowing for less energy consuming preservation processes, improving retailers' and consumers' satisfaction and consolidating rapports within the supply chain.”
One of the challenges facing the corrugated box market includes increasing prices for the raw materials used to make the boxes. Prices during the second quarter of 2017 averaged $149 a ton, compared to $85 a ton a year ago, according to a report from BMO Capital Markets. This is because of growing demand for boxes and supplies of the material in the United States dropping. This year the supplies have decreased by 2.3 %.
David Urquhart, president of New England Wooden Ware Corp said: “It’s forced some of my paper suppliers to increase prices which I will not be able to pass along.”
On the other hand, Mark Wilde, a managing director at BMO Capital Markets, believes the boom in e-commerce could actually lower demand for corrugated boxes, as retailers look for alternatives to ever more expensive corrugated containers.