"Direct Hit from North Gyeongsang Wildfires"... Corrugated Cardboard Base Paper Industry Faces Triple Crisis

Last Year’s Corrugated Cardboard Base Paper Production Reached 5.57 Million Tons
Down 6.8% Compared to 2021
Industry Faces ‘Triple Crisis’ Due to North Gyeongsang Wildfires and Cold Damage

At the beginning of this year, a series of large-scale wildfires in the North Gyeongsang region has deepened concerns within the corrugated cardboard base paper industry. Typically, the summer and autumn seasons, when agricultural harvests increase, are considered peak periods for the industry. However, as farmland has been destroyed by wildfires, it is predicted that demand for agricultural product packaging boxes will drop sharply this year. In addition, demand for parcel delivery boxes, which has supported the industry since the COVID-19 pandemic, is also on a downward trend, fueling a sense of crisis throughout the sector.

An employee is joining a corrugated cardboard box with wire. Photo by Asia Economy

According to the Korea Paper Association on May 8, last year’s production of corrugated cardboard base paper was 5.57 million tons, a decrease of 3.64% compared to 2020, when the COVID-19 pandemic began in earnest (5.78 million tons). Compared to 2021, when the pandemic peaked (5.98 million tons), this represents a decrease of nearly 7%. Production volumes were 5.64 million tons in 2022 and 5.45 million tons in 2023, showing a steady decline since the end of social distancing measures. An industry official said, “Even when the entire paper industry was sluggish due to weak domestic demand, the situation for the corrugated cardboard base paper sector was considered relatively better. However, as demand for parcel delivery boxes has recently dropped noticeably, the corrugated cardboard industry is now also on edge.”

To make matters worse, the industry is facing a triple crisis as wildfires and cold damage have hit the North Gyeongsang region. Disruptions in the shipment of agricultural products, which were scheduled to be shipped one after another from spring, are expected to reduce demand for agricultural packaging boxes compared to previous years. According to North Gyeongsang Province and other sources, wildfires that occurred from late March to early April destroyed 3,862 hectares of crops, 783 greenhouse facilities, 235 livestock barns, and 10,883 pieces of agricultural machinery. Even recently, unseasonably cold weather has continued, causing frost damage that freezes flowers before fruit can form, further increasing losses for farmers.

An industry official stated, “Agricultural product packaging boxes account for about 30 to 40 percent of corrugated cardboard sales, which is a significant share. Normally, with the shipment of strawberries, peaches, cabbage, lettuce, pears, and other products starting in spring, production of corrugated cardboard base paper would peak around July or August. However, this year, it is difficult to predict the situation.” The official also added, “The damage from summer typhoons and heavy rains has not even been factored in yet. When summer arrives, the situation for the industry could become even worse.”