According to a recent report by Bank of America, the cardboard box recession in America is ending as packaging prices rise. This recession indicator was triggered when demand for packaging dropped to its lowest levels since 2009. However, the packaging industry now anticipates a 3% growth outlook for the upcoming quarters, indicating a positive shift in the market.
The resurgence in packaging prices signals a turnaround for the cardboard box recession in America according to Bank of America. Although industry data has been negative since the second half of 2022, recent surveys from the bank are showing optimistic growth expectations for the future. This is encouraging news for the economy overall, as it puts to rest concerns about a potential consumer spending downturn.
Last year’s dip in demand for cardboard packaging raised alarms among analysts including Charles Schwab who warned of a possible “cardboard-box recession” affecting various sectors. However, the economy and markets have defied expectations with strong performances since then. Consumer spending has remained solid, contributing to record-breaking highs in the stock market. Now, the packaging industry is also seeing positive developments with growth outlooks improving significantly.
According to Bank of America’s research analyst George Staphos, independent box makers are seeing better demand than expected with growth projections shifting from 0.6% to over 3%. While inflation is a contributing factor to this growth, demand expectations are also playing a significant role. The bank’s survey indicates that a large percentage of respondents anticipate better demand in the next six to twelve months compared to earlier in the year.
