Packaging Corporation of America and the $200 Million Gamble

Ecommerce has taken off in the last 4 years, and that growth is just going to continue to increase exponentially in the years to come. As the web becomes the go-to medium for shopping, the volume of shipping will also increase to compensate for the outpour of deliveries. Consequently, the demand for cardboard boxes and thermal shipping labels has skyrocketed. Any company with an ecommerce presence has to now adjust their operations to accommodate for this shift.

Packaging Corporation of America (PCA) is a giant in the cardboard box industry. They own numerous containerboard mills, paper mills, converting facilities, and packaging & supply centers. One of their better known divisions is Boise Paper, a huge producer of release liner.

Come April, PCA has plans to invest close to $200 million to convert their paper machines to produce containerboard instead of its popular release liner. This will spur a huge shortage in the release liner industry. The machinery is operated by Boise Paper and was initially used to produce specialty release liner for their major customer, Avery Dennison. This ultimately turned out to not be as profitable as PCA had originally anticipated. The machines were very sensitive to contaminants, causing frequent shutdowns.

Boise currently holds 1/3rd of the North American release liner market, so this change will largely effect label manufacturers everywhere. To read more about this, check out the full article here.”

Courtesy of Smith Corona

 

 

 

 

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