Source: China good packaging

On December 4th, the Environmental Protection Bureau of Ningxiang City, Hunan Province proposed to approve the “Environmental Impact Report Form for Green Packaging Carton Project of Hunan Rongcheng Environmental Protection Packaging Co., Ltd.”. The total investment of the project is 320 million yuan. After the project is put into production, it will have an annual production capacity of 180 million square meters of carton.

In addition to Rongcheng Paper, there have been many paper mills that have entered the packaging market in recent years. Obviously, the industrial chain is accelerating integration. The paper mills are not necessarily only papermaking. The packaging market is not only a packaging factory, but some enterprises that rely on low prices to maintain their survival will face more intense competition.

Invest 320 million annual production of 180 million m2 carton

The report shows that Hunan Rongcheng Environmental Protection Packaging Co., Ltd. is located in the Ningxiang Economic and Technological Development Zone, facing Lanyuegu Road in the west and Yupingshan Park in the east.

The project covers an area of ​​81,316 square meters with a total investment of 320 million. The main construction contents include carton production workshop, waste paper packaging workshop, office building, dormitory building, auxiliary building, and auto repair room. At the same time, supporting public facilities such as water supply and drainage, power supply and so on. After the project is put into production, it will form an annual production capacity of 180 million square meters of carton.

On June 1 this year, Yao Changkun, general manager of Taiwan Rongcheng Group, general manager of Jiangsu Rongcheng Environmental Protection Technology Co., Ltd., Dai Zhongya, deputy secretary of the Party Working Committee of Ningxiang Economic Development Zone and director of the management committee, signed the contract on behalf of both parties.

According to local media reports, the project will all adopt German imported production equipment and professional ERP production management system, which will be completed and put into operation in the second half of 2019.

Focus on the development of the carton market

In 1996, Rongcheng Group was laid out in the mainland. After more than 20 years of development, it has built three low-carbon paper mills in Wuxi, Jiangsu, Pinghu, Zhejiang, and Songzi, Hubei, with an annual output of about 3.3 million tons of raw paper. In Shanghai, Suzhou, Hangzhou, Wuhan and other cities, Rongcheng Paper has laid out seven green packaging bases.

However, in recent years, affected by factors such as the Sino-US trade war, the depreciation of the renminbi, and the decline in market demand, Rongcheng Paper has not done well in the mainland market. But this did not affect its pace of expansion, but its investment focus has shifted to the downstream carton market.

In November this year, according to the Taiwan media’s Zhongshi Electronics News, Rongcheng’s vice president Zou Yongfang said that Rongcheng Paper’s layout in the upstream packaging paper industry has reached economies of scale, and the market share of downstream cartons is relatively low. The carton factory will be gradually expanded in the future. Scale, directly face customers and master the market, and integrate the industrial value chain.

Zou Yongfang also said that Rongcheng will focus on the development of special packaging requirements for 3C products, frozen vegetables, insulation, etc., to provide customers with tailor-made green packaging, design packaging, and take into account structural safety and reduction.

Stretching the industrial chain to penetrate the downstream packaging industry

Rongcheng Paper is just one of many paper mills that have cut into the downstream packaging industry in recent years. As far as 2018 is concerned, there are many paper mills that have made great strides in the downstream packaging and printing industry. The rapid action and the scale are amazing:

In July of this year, a “Cardboard Test Machine Quotation” of Xiaolong Intelligent Packaging (Dongguan) Co., Ltd. entered the market. It is estimated that the offer is at least 10% lower than the equivalent specifications of its peers. Despite the pressure, the quotation will be invalidated shortly after its implementation, but its impact is still in the ears.

This year, Yantai City Dazhan Paper Co., Ltd. has an annual output of more than 200,000 tons of various types of packaging paper. Its packaging factory has also developed into the largest packaging company in the tobacco area. In order to maintain its advantage, the company eliminated the existing 1.8-meter cardboard production line, invested 120 million, and added a new 2.8-meter production line imported from Italy.

In November of this year, Zhejiang Rongsheng Environmental Protection Paper started the project of 300 million square meters of new intelligent packaging materials. The project introduced two advanced corrugated board production lines. The construction period of the project is two years. It is planned to be put into operation in the third year, reaching 80% of the design capacity and reaching the fourth year.

There are many more examples like this. In fact, the reason why many paper mills cut into the downstream packaging industry is to integrate the industrial chain and realize the integrated operation of the papermaking and packaging industries, thereby improving the overall operating efficiency and effectively preventing the risks brought by fluctuations in the upstream and downstream industries.

But it is so rare and urgent like this year. It is conceivable that in the next few years, the number of paper mills entering the packaging market will increase, and some paperboard factories and carton factories that rely on low prices to maintain their survival will face the danger of being cleared.

Editor in charge: Zheng

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