International Paper: demand for pulp will grow

International Paper Company projected strong demand for corrugated packaging and pulp in 2022, normalizing as Omicron’s recovery restrictions progresses in the near term.

The company also expects to make good progress on its Building a Better IP initiatives, which will increase as the year progresses.

Overall, International Paper is well positioned to optimize its containerboard mill and corrugated box system following several outages in 2021, which will further improve its distribution and operating costs.

Regarding its capital allocation, the company is targeting capital expenditures of $1.1 billion.

The planned increase is primarily due to investments in its packaging business to develop capabilities in its case system to drive profitable growth.

International Paper

The company is a global producer of renewable fiber-based pulp and packaging products with manufacturing operations in North America, Latin America, Europe and North Africa.

In the United States, as of December 31, 2021, the company operated 24 pulp and packaging plants, 163 converting and packaging plants, 16 recycling plants and three bag facilities.

Production facilities at the end of 2021 in Canada, Europe, North Africa and Latin America included four pulp and packing plants, 37 converting and packing plants and two recycling plants.

It operates a printing and packaging products distribution business primarily through six branches in Asia.

Virtually all of its businesses have experienced, and are likely to continue to experience, cycles related to industry capacity and general economic conditions.

Looking ahead to the first quarter of 2022, compared to the fourth quarter of 2021, in its industrial packaging business, it expects earnings related to the price movement published in August 2021.

Volume is expected to be lower in the first quarter of 2022 due to lower seasonal demand and the impact of the Omicron variant of Covid-19 on labor availability and supply chains, although it considers an improvement to as the first trimester progresses.

As of December 31, 2021, the company have approximately 38,200 employees, nearly 31,000 of whom are located in the United States.


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