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BoardConverting Serving the North American Corrugated and Folding Carton Industries for 36 years May 11, 2020 VOL. 36, NO. 19
The Five Top Strategies Leaders Must Adopt In Times Of Crisis BY SHELLEY ARMATO Entrepreneurs, business owners, and company leaders in the corrugat- ed and folding carton industry – and virtually every other industry – are living in a state of overwhelm right now. The rules of business have changed seemingly overnight, and many are struggling to adapt to the new normal of our current reality.
GLBC Acquires Ideon Packaging
Vancouver, British Columbia based Great Little Box Company (GLBC) has announced the ac- quisition of Richmond, British Columbia based Ideon Packaging. The acquisition of Ideon by GLBC – an award-winning manufacturer and distributor of packaging solutions since 1982 – brings together two independent and local- ly owned businesses with a shared focus on quality, innovation, people and culture. Ideon, a fast-growing leader in custom packaging, had grown to excel and differen- tiate in a competitive landscape. As both or- ganizations enter the second generation of leadership, talks of uniting began in late 2019. Together, GLBC and Ideon will offer a breadth of products, service and customer excellence unlike anything in the North Amer- ican market. Working alongside each other, both groups will unite leadership teams with a focus on furthering innovation, growth and care for their employees and customers. What this means for customers is they can expect the same exceptional quality, service and innovation that has come to distinguish each organization – but with a deeper prod- uct and service offering. For employees of the
The number of decisions business owners and leaders need to make daily is staggering. How do we communicate with customers? What do we do about projects put on hold? How do we keep our em- ployees safe? What kind of infrastructure do we need to support our remote workers? And of course, the biggest decision of all, what steps must we take to ensure our business survives this crisis? Being a business owner or company leader requires you to be nim- ble and ready to react at a moment’s notice. But that doesn’t negate the fact that you’re feeling stressed and overwhelmed. Now more than ever you need to commit to your goals and squash any fears that may be holding you or your company back. The following five strategies will help you through any challenge, stay on track with your goals, and emerge from the crisis victoriously. 1. Be Tenacious As an entrepreneur, business owner, or company leader, you likely made the decision to be tenacious long ago. After all, if you hadn’t, you
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WHAT’S INSIDE ISM: Manufacturing Shrinks In April, Economy Contracts
6 x x 8 x x 12 x x 26 x x
16 Fosber America Begins Expansion In Green Bay 8 AICC Empowers Packaging Students With Online Courses 3 Custom Shredder Solutions Equals Big Cost Savings
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AVERAGE CONTAINERBOARD PRICES The average prices reported are tabulated from prices PAID by various sources throughout the United States the week previous to issue. Prices in some areas of the country may be higher or lower than the tabulated average. The prices tabulated here are intended only for purposes of reference. They do not connote any commitment to sell any material at the indi- cated average. Transactions may be completed at any time at a price agreed upon by seller and purchaser.
REGION E. Coast Midwest Southeast Southwest
42# Kraft liner $885.00-890.00 $900.00-910.00 $900.00-910.00 $900.00-910.00 $930.00-940.00 $903.00-912.00
26# Semi-Chem. Medium
Short Ton Del. Short Ton Del. Short Ton Del. Short Ton Del. Short Ton Del. Short Ton Del.
$820.00-850.00 $835.00-855.00 $835.00-855.00 $835.00-855.00 $865.00-875.00 $838.00-858.00
West Coast U.S. Average
SHEET PRICES BY REGION (AVERAGE) Per 1MSF, local delivery included, 50MSF single item order, truckload delivery. Sheets
E. Coast Midwest South-SW S. CA N.CA/WA-OR US Aver.
200# 275#
$62.26
$72.05
$62.69 $82.80
$85.35 119.54
$73.13 101.29
97.32
99.89
90.86
113.65
OYSTER UP-CHARGE 8.34
8.34
8.34
8.34
8.34
8.34
275# DBL-WALL 350# DBL-WALL
107.46 118.45
114.69 129.32
116.54 137.25 117.82 145.56
141.08
122.76
148.46
131.80
CANADIAN SHEET PRICES (AVERAGE) In Canadian Dollars, per 1MSF, local delivery included, under 50MSF single item order, truckload delivery. 200# 275# Oyster UC 275#DW 350#DW $78.56 $99.18 $9.00 $96.32 $105.83 CANADIAN LINERBOARD & MEDIUM The average prices reported are tabulated from prices PAID by various sources throughout Canada. Prices may be higher or lower in various areas of the country. The prices tabulated here are intended only for purposes of reference. They do not connote any commitment to sell any material at the indicated average. Transactions may be completed at any time at a price agreed upon by seller and purchaser. Prices are Canadian $ and per metric ton.
42# Kraft Liner 26#
Semi-Chem Medium
East West
$920.00 $965.00
$910.00 $945.00
AVERAGE CONTAINERBOARD PRICES.indd 1
3/7/19 2:04 PM
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May 11, 2020
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GLBC Acquires (CONT’D FROM PAGE 1 )
Core Competency
organizations, a goal of 100 percent employee retention has been set. It is a foundational part of the union estab- lished to ensure that synergies are realized through com- bining strengths and working together to compete in new areas previously unavailable. In the coming months, these two packagers will oper- ate alongside each other in their existing facilities working towards long term integration. With a mantra of “Better To- gether,” GLBC will ensure job security, innovation, people and culture remain a priority. “Since 2001 Ideon has been a fierce competitor vying to build relationships, trust and business,” said GLBC Pres- ident, Brad Tindall. “We have always respected the way in which Ideon’s people, leaders and owners act and com- pete in the market. We look forward to working closely to- gether to further our capabilities and success.” “Great Little Box acquiring Ideon will make for an in- credible team,” said Rick Van Poele, CEO Ideon Packaging. “I have always been very impressed by GLBC’s emphasis on community and I know our people will continue to flour- ish in partnership. GLBC has always put their people and customer experience at the forefront of their business, and they continuously demonstrate that a focus on culture and community will lead to success. With this, I know our ex- ceptional team at Ideon will be in great hands to continue to thrive.”
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ISM: Manufacturing Shrinks In April, Economy Contracts After 131 Months Economic activity in the manufacturing sector contract- ed in April, and the overall economy contracted after 131 consecutive months of expansion, say the nation’s supply executives in the latest Manufacturing ISM Report On Busi- ness. The report was issued last week by Timothy R. Fiore, CPSM, C.P.M., Chair of the Institute for Supply Manage- ment (ISM) Manufacturing Business Survey Committee: “The April PMI registered 41.5 percent, down 7.6 percent- age points from the March reading of 49.1 percent. The New Orders Index registered 27.1 percent, a decrease of 15.1 percentage points from the March reading of 42.2 per- cent. The Production Index registered 27.5 percent, down 20.2 percentage points compared to the March reading of
47.7 percent. The Backlog of Orders Index registered 37.8 percent, a decrease of 8.1 percentage points compared to the March reading of 45.9 percent. The Employment Index registered 27.5 percent, a decrease of 16.3 percentage points from the March reading of 43.8 percent. The Sup- plier Deliveries Index registered 76 percent, up 11 percent- age points from the March reading of 65 percent, limiting the decrease in the composite PMI. “The Inventories Index registered 49.7 percent; 2.8 per- centage points higher than the March reading of 46.9 per- cent. The Prices Index registered 35.3 percent, down 2.1 percentage points compared to the March reading of 37.4 percent. The New Export Orders Index registered 35.3 percent, a decrease of 11.3 percentage points compared to the March reading of 46.6 percent. The Imports Index registered 42.7 percent, a 0.6-percentage point increase from the March reading of 42.1 percent. “Comments from the panel were strongly negative
(three negative comments for every one positive comment) regarding the near-term outlook, with sentiment clearly impacted by the coronavirus (COVID-19) pandemic and continuing energy market recession. The PMI indicates a level of manufacturing-sec- tor contraction not seen since April 2009, with a strongly negative trajectory. Demand contracted heavily, with the (1) New Orders Index contracting at a very strong level, again pushed by new export order contrac- tion, (2) Customers’ Inventories Index ap- proaching a level that is considered a nega- tive for future production, and (3) Backlog of Orders Index strongly contracting, in spite of a lack of production during the period. Consumption (measured by the Production and Employment indexes) contributed neg- atively (a combined 36.5-percentage point decrease) to the PMI calculation, with ac- tivity dramatically contracting due to plant closures and lack of demand. Inputs — ex- pressed as supplier deliveries, inventories and imports — strengthened again due to supplier delivery issues that were partially offset by continuing imports sluggishness. The delivery issues were the result of dis- ruptions in domestic and global supply chains, driven primarily by supplier plant shutdowns. Inventory contraction slowed due to throughput issues. Inputs contribut- ed positively (a combined 13.8-percentage point increase) to the PMI calculation. (The Supplier Deliveries and Inventories indexes directly factor into the PMI; the Imports In- dex does not.) Prices continued to contract (and at a faster rate in April), supporting a negative outlook.
CONTINUED ON PAGE 34
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May 11, 2020
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PCA Reports Record Volumes In Strong 1Q
Box Shipments ( U.S. Corrugated Product Shipments) Industry Shipments In Billions of Square Feet Month March 2020
Lake Forest, Illinois based Packaging Corporation of America reported 1Q 2020 net income of $142 million, or $1.49 per share, and net income of $143 million, or $1.50 per share, excluding special items. 1Q net sales were $1.7 billion in 2020 and 2019. In the Packaging segment, total corrugated products shipments with one additional workday were up 5.6 per- cent and shipments per day were up 3.9 percent over last year’s 1Q. Containerboard production was 1,047,000 tons, and inventory was down 79,000 tons compared to 1Q of 2019 and down 39,000 tons from Q4 of 2019. “Strong demand in our Packaging segment drove first quarter results,” said Mark W. Kowlzan, Chairman and CEO. “We had record first quarter volume in our contain- erboard mills and a new all-time quarterly volume record in our corrugated products plants. The integration rate of our mill’s volume into our plants was 95 percent and our containerboard inventory was at the lowest level since our acquisition of the Boise packaging business. In our Paper segment, volume and prices were lower as expected, but both were slightly better than anticipated. “Both the mills and the corrugated products plants did a great job of running their operations safely, and in
Year
Actual
Percent Change Avg Week Percent Change
2020 2019
34.739 31.870
9.0
7.895 7.588
4.0
Industry Total
Year-to Date
March 2020
Year
Actual
Percent Change Avg Week Percent Change
2020 2019
98.981 94.892
4.3
7.733 7.531
2.7
Industry Total
Containerboard Consumption (Thousands of Tons)
Year
Month
Percent Change Year-to-Date Percent Change
2020 2019
2.8653 2.5967
10.3
8.1983 7.8036
5.1
Container Board Inventory - Corrugator Plants (Thousands of Tons)
Corrugator Plants Only
Date
Percent Change Weeks of Supply
Percent Change
Mar. Feb.
2.1278 2.2978
-7.4
3.3 3.7
-10.8
Shipping Days
Year
Month
Year-to-Date
2020 2019
22 21
64 63
SOURCE: Fibre Box Association
CONTINUED ON PAGE 10
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May 11, 2020
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PCA Reports (CONT’D FROM PAGE 8)
a cost-effective manner, while facing the unprecedented conditions brought on by the COVID-19 pandemic. All fa- cilities operated in adherence to CDC guidelines and fol- lowed a strict protocol for workplace operations, as well as notification of and response to potential issues. So far, we have not experienced any material disruption in our oper- ations or our supply chain due to the pandemic.” FBA Names Officers, Board Members The FBA Board of Directors elected Cathy Foley, VP Indus- try Relations and Supply Chain at Pratt Industries, as the Association’s 2020 - 2021 Chairman. Additional officer elections include First Vice Chairman Bob Landaal, Landaal Packaging Systems; Second Vice Chairman Doug Bosnik, Buckeye Corrugated, Inc.; Imme- diate Past Chairman Jeff Chalovich, WestRock; and staff President Dennis Colley along with Senior Vice President Rachel Kenyon. New or re-elected Board members approved by vote of all members include Rob Barger, Georgia-Pacific Corru- gated LLC; Tim Bergwall, Greif, Inc.; Doug Bosnik, Buckeye Corrugated, Inc.; John Davis, Great Northern Corporation; Greg Hall, Hood Container; Mark Ushpol, DS Smith, NAPP; and Greg Wanta, International Paper.
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Thank You For Making Boxes BY RACHEL KENYON
At the onset of the novel coronavirus, when we first heard about the pan- demic that causes COVID-19, we also learned about the meaning of “Stay at Home” orders and what was deemed “Essential Businesses”.
As the Guidance on Essential Critical Infrastruc- ture Workforce was rolled out by the Department of Homeland Security’s Cybersecurity and Infra- structure Security Agency (CISA), both federal and state governments and the rest of us quickly learned that nothing safely moves food and other consumer products, medical and pharmaceutical products, tis- sue and hygiene products and more as effectively or
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efficiently as a corrugated cardboard box. From point A to point B, corru- gated boxes are specifically engineered to protect and cushion products along their journey. Simply put, corrugated cardboard packaging is the backbone of the American supply chain. To keep the flow of products moving to market, the corrugated industry was recognized as “essential.” The US corrugated packaging industry is a $35.2 billion manufacturing sector. There are 1,183 box plants operating in nearly 1,000 cities and towns across America. The corrugated indus- try provides employment and benefits to more than 100,000 Americans. The industry makes packaging that is essential to our everyday lives from renewable and recyclable resources. In fact, more than 95 percent of all goods consumed in North America are packaged and transported in cor- rugated packaging and close to 40 percent of all corrugated packaging produced annually is used to package food and beverages. Disruption in the availability of these goods would cause significant hardships to consumers across the country who depend on steady and stable supplies. Box manufacturers have stepped up to the challenge. They have in- creased production of corrugated cardboard boxes to keep transport packaging flowing to other makers of essential products including pack- aging for food and other consumer products, medical and pharmaceutical products, tissue and hygiene products and more. Corrugated cardboard boxes are essential to supporting online purchases of goods being deliv- ered directly to homes. For this ongoing work, the Fibre Box Association (FBA) salutes all of the front-line employees in the corrugated industry. To our member compa- nies’ teams and our industry’s suppliers, we are grateful for your dedica- tion and commitment to your jobs and for making corrugated packaging. We extend a heartfelt thank you for the work you are doing to keep the supply chain moving. And we are not alone in recognizing your daily achievements. FBA has been posting our thanks to social media platforms and we’re getting com- ments back. On LinkedIn, we heard from Amy, who said, “Thanks to all that keep our box plants running!!!!”, from Rhea, who said, “100 percent agree! Thank you so much to everyone working around the clock to keep products flow- ing to our marketplace.” and Bill, who said, “Shout out to all the workers in corrugated sheet and converting plants! #choosecorrugated. On Facebook, we heard from Susan, who said, “Amazing how peo- ple are discovering the things that are really vital during times like these. There are a lot of professions that had been marginalized for years and CONTINUED ON PAGE 14
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