Containerboard Shipments Starting to Make Cyclical Recovery

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Mark Wilde, senior analyst with Deutsche Bank, notes that March U.S. containerboard and box numbers show that industry volumes continue to make a cyclical recovery. Box shipment volumes rose 6.8% y/y, he says, adding that, adjusted for one more shipping day this year, box volumes rose 2.1% on an "average week" basis.

"We think that the 'real' number is a blend of the two, or a y/y increase of 4.5%. This compares with blended y/y comps of +6.0% in February, -1.6% in January, and +3.3% in December. March 2009 represented a particularly easy comp, with the blended y/y comp down 12.1% y/y, compared with blended y/y comps down in the 10%-11% range in the surrounding months. Throughout the second half of 2009, box volumes were lagging broader economic indicators such as the ISM manufacturing index. It now appears that box volumes are starting to catch up," Wilde explains.