Hartsville, South Carolina based Sonoco announced last week that it is implementing a $50/ton increase on all domestic and export corrugating medium grades shipping from its Hartsville mill. The prices are effective with shipments on and after November 2, 2020. According to Tim Davis, Division Vice President and General Manager, Paper and Adhesives, U.S./Canada, Sonoco is responding to changes in market demand and order backlogs, in line with other North American containerboard producers.
According to an industry analyst, the company’s focus on optimizing businesses through productivity improvement, standardization and cost controls will also aid its performance in the near term. In addition, the stable price of OCC is likely to offset the negative impacts of price/cost and improving operating margins.
Sonoco expects its Consumer Packaging segment to gain from the demand from stay-at-home customers owing to the pandemic. Approximately 80 percent of the segment’s sales flow in from food packaging, where the company is witnessing increased orders. Further, paperboard operations in North America are likely to be relatively steadier as elevated demand for the tissue and the towel market will help offset declines from some industrial converted-product businesses.
