December 11, 2020

Japan National Federation of Corrugated Cardboard Industry Associations  (JCCA)

It is forecasted that 2021 Corrugated board demand will be14,300 million m², a 101.4% year-on-year rise.

Due to the impact of the spread of the COVID-19, the real GDP growth rate fell to -28.8% from the previous quarter from April to June . In terms of the preliminary figures for July to September, although it recovered to + 21.4%, there is still a large gap from the situation before the pandemic. Many private research institutes predict that real GDP in 2020 will grow negatively in the mid -5% range.

Demand for corrugated cardboard in 2020 will continue to fall below the previous year's level, with cumulative January-October sales 96.8% of the previous year. The cumulative forecast for January-December is about 14,100 million m2 (96.6% compared to the previous year), which is significantly lower than the forecast announced by the Federation in December 2019, which is 100.7% compared to the previous year.

Japan’s economy recovery in fiscal 2021 is expected to remain moderate, albeit with a rebound from the sharp decline in 2020. The real GDP growth rate forecast by private research institutes is generally over 3%.

In consideration of such corrugated cardboard demand trends and economic outlook, the demand for corrugated cardboard in 2021 is forecast to be 14,300 million m2 (a year-on-year increase of 101.4%).

The breakdown by period is forecast to achieve99.0% of previous year in January-March, 102.5% in April-September, and 101.5% in October-December. It is estimated that in April-September the decline will end and will see s rising trend.

As for trends by demand sector, sales to “processed foods” sector (41% of the total) are expected to grow by about 2%, with steady demand for home-cooked meals and a gradual recovery from the latter half of the year for commercial use.

Sales to “others” (17% of the total) are forecast to grow by about 1%, demand for household paper-related products will remain steady, hygiene products for the elderly will rise.

Sales to “fruits and vegetables” sector (10% of the total) are expected to grow by about 1%.Although the planting area for fruits and vegetables are declining, the demand will see a recovery from previous year when impacted by the lack of sunshine due to the long rain and intense heat drought.

Sales to “electrical appliances and machinery/appliances” sector (7% of the total) are expected to grow by about 2%, mainly for automobiles.

Sales to “chemicals /detergents /cosmetics” sector (6% of the total) are forecast to be about the same as the previous year because demand for chemicals and detergents will grow while inbound demand for cosmetics cannot be expected to recover.

As for “mail order /home delivery /moving” (5% of the total), it is expected to see a 2% increase as the e-commerce market continued to grow.

* Since January 2020, new businesses have been added to the statistics (approximately 1.9%, equivalent to 276 million m² /year), so the year-on-year comparison is adjusted only in 2020. The additional amount is not included in the production in 2019.