Corrugated Price Increase Hits

As many of you know, corrugated mother carton and tray pricing went up about 8.0% last fall. At Atlas, we were able to mitigate that and our customers generally went up about 6.5%. The rest of you, I suspect, felt similar pain with your own corrugated suppliers.

Now, we’re sorry to say that there’s another one coming.

About the increase

Corrugated pricing is largely commodity-driven. OCC (old corrugated cartons for recycling) and kraft linerboard material represent the bulk of the cost of a carton. For the last three or four years, pricing has been relatively stable. But now that…supposedly…the economy is picking up, mills are raising their prices.  The “Yellow Sheet,” RSI’s publication Pulp & Paper Week announced increases in recycled fiber pricing in March, and a $50.00 per ton market increase in linerboard in late April. Where the mills go, the finished box plants must follow within a few weeks. $10 per linerboard ton generally means 2% in finished boxes. So there’s an average 10% price increase about to hit.

Atlas’s increase will be 9.5%, and it takes effect for shipments on or after Monday, May 22. That’s the date that we’re hearing from many other beverage box suppliers as as well.

Act Now on Reorders and Stock Items

We encourage our customers (and even our non-customers) to check their inventories and contact us (or their other supplier) immediately if they need more mother cartons, trays or stock boxes in the near future. There isn’t enough time to get a new custom printed carton through the system before the increase, but at least at Atlas, there IS still time for reorders of printed cartons and shipments of our unprinted stock can case trays. There should also be time to get one through at your own plant, if you’re not buying from us.

That being said, box plant schedules always fill up in advance of a price increase. The typical 5-8 working day lead time for a box or tray may extend beyond 10 days. Try as you might, you may not be able to secure a pre-increase ship date on orders placed after about May 8 with many box plants.

Let us know if you have questions about the corrugated or other paperboard markets. We do our best to keep our customers and newsletter subscribers apprised of changes, alerting them to any announced increases in the other board grades they use for can boxes, six pack carriers, and the like, and we will of course, work with our manufacturers to bring prices back down if and when the market softens.

We usually do this via our newsletters, which are only sent out about once a month. If you’d like to get on our newsletter list, call us at 800.247.0360 or send us an email at info@atlaslabels.com or our direct email addresses.

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