The initiative strated last week by Georgia-Pacific and joined within hours by Smurfit-Stone Container now has been backed by the industry's top eight producers of linerboard and corrugating medium.

International Paper, Weyerhaeuser, Temple-Inland, Packaging Corp. of America, Norampac and Rock-Tenn informed customers last week and this of their intention to raise recycled and virgin grades of linerboard and corrugating medium. The virgin benchmark grades will reach new highs of $610 and $590/ton.

The announcement today by Rock-Tenn on recycled linerboard from Solvay Paperboard and recycled medium from its St. Paul, Minn., mill was especially signficant.

Solvay has been a supplier to independent boxmakers and the failure of the $50/ton increase in March was essentially killed by resistance from independent boxmakers, as well as the corrugated customers of the major integrateds in the current weak U.S. manufacturing environment.

U.S. box shipments continue to be weak and are down 2.4% for four months on an equal shipping week basis, according to the Fibre Box Assn. At the same time, industry inventories of containerboard rose steadily from last October through the first quarter and added 338,000 tons, or 15.4% over those five months.

In the past month, however, the dynamics of the North American containerboard market have changed markedly.

The principal factor is the fatal recovery boiler explosion at IP’s 550,000-ton unbleached kraft linerboard mill in Vicksburg, Miss., on May 5. The accident will idle the mill until mid-November and will result in the loss of some 45,000 tons per month. IP will be scrambling in the marketplace to meet its own box plant requirements as the mill produces 10.5% of IP’s linerboard capacity, as well as 1.5% of the industry’s North America capacity.

With the supply squeeze on IP, which is one of the largest sellers to independent boxmakers, the independents may not have much recourse as summer progresses but to accept the price increases they have opposed. August through October is traditionally the strongest corrugated season. In addition, rising production costs since March are likely to give producers even more incentive to drive the new increases home.

In addition, according to FBA and AF&PA data, April's liner and medium inventories fell by 105,400 tons at box plants and 27,854 tons at the mill level.

That not only ended a five months of consecutive increases but left levels at their lowest for April since 2004 and second lowest in the past 20 years. The industry downtime of 160,000 tons was the most since January 2007,