Key opportunities and challenges for the European containerboard and carton processing industry in 2024

The current demand situation for containerboard is undoubtedly challenging. There is widespread unease about the slowdown in demand, especially as new capacity floods into the European market. This has caused significant concern across the industry. However, it is important to remember that the industry has been quite profitable in recent years. Even less competitive capacity can generate profits, but the current situation makes these less competitive companies likely to come under pressure.

It is foreseeable that some capacity will inevitably disappear as profit margins fall. This, in turn, should help to rebalance the market to some extent in the future. So, while the current situation is worrying, there is a possibility of a natural correction in the market that will stabilize the situation in the future.

In 2024, in terms of the main objectives of companies operating corrugated box processing plants, the current focus is mainly on volume. Due to the demand situation, many companies are trying to gain some sales volume. There is also introspection in terms of reducing costs and improving efficiency. Although strategic themes such as sustainability seem to be on the back burner, they remain an implied demand due to their sustainable advantages that make paper packaging products easier to sell in the packaging market.https://www.risedongsheng.com/

In the coming year, from a European perspective, mergers and acquisitions and consolidation are first and foremost. Despite the current slump in demand, falling profitability and rising interest rates, mergers and acquisitions are still an opportunity for any company with strong financials, strong balance sheets and ample cash reserves.

We see this through the large merger between Murphy Kappa and Viselok, which could drive further M & A activity. It is worth noting that the European market is more fragmented than the US market, and although it cannot be 100% comparable due to its market structure and players, the European market can be considered a benchmark.

Other opportunities lie in cost and efficiency improvements. It is critical to explore untouched topics, drive innovation in the process of change, and make more radical changes due to the economic situation. To achieve higher levels of improvement, these efforts must be supported by cutting-edge technologies such as artificial intelligence. This is especially important when aiming to effectively capture cost and productivity advantages.https://www.risedongsheng.com/

As for how the current situation will affect talent management and attraction? It should be said that talent management and attraction is crucial to the development of the paper packaging industry and has always been the focus of attention. However, currently we are facing multiple challenges. For example, in Europe, the workforce is aging. Many people have dedicated decades of their lives to the industry, often working in the same paper mill or processing plant for 10, 20 or even 30 + years. With these experienced professionals retiring, we are experiencing a talent gap.

The paper packaging industry has a compelling selling point that it can and does attract talent. However, the paper packaging industry must overhaul the existing working model. The next generation of workers is less willing to work long hours or adhere to an outdated shift system, and we are dealing with higher attrition rates. This shift forces us to face a changing reality and believe this is an opportunity for the industry to reinvent itself. We need to find ways to do more with less, break traditional boundaries and use technology effectively.https://www.risedongsheng.com/

Automation is one answer to these challenges. It has made progress in areas where there is a shortage of qualified and unskilled labor, but automation alone is not enough. We also need to make jobs in the industry more attractive to future generations. This strategic combination can not only help us address the current talent gap, but also ensure the continued growth and success of the paper packaging industry.