This category includes establishments primarily engaged in manufacturing non-folding food containers from special foodboard. Industry products include paperboard beverage cartons, round and nested food containers, paper cups for hot or cold drinks, and stamped plates, dishes, spoons, and similar products. Establishments primarily engaged in manufacturing similar items from plastic materials are classified in Industry Group 308; those making folding sanitary cartons are classified in SIC 2657: Folding Paperboard Boxes, Including Sanitary.
322215 (Non-Folding Sanitary Food Container Manufacturing)
Sanitary food containers have been a strong growth market for the paper industry. Despite increasing consumer interest in reducing usage of disposable products, the convenience of disposable paper products has continued to appeal to growing numbers of consumers. Also, the use of paperboard milk cartons in alternative, nonfood markets has given that part of the industry a healthy boost.
In the late 1990s, the value of U.S. sanitary food container product shipments remained steady at roughly $2.9 billion. Shipments totaled $2.95 billion in 2000. This industry consists of three major segments. Cups and liquid-tight paper and paperboard containers were a bit less than half ($1.35 billion) of the value of all industry shipments in the late 1990s. Milk and milk-type paperboard cartons were the next largest category, at $684.0 million; other sanitary paper and paperboard food containers, boards, and trays, except folding accounted for $641.9 million; and all other products took up the remaining $65.0 million.
Sanitary-food-container manufacturers employed 13,886 people in 2000, down from 15,700 in 1990. There were 83 establishments in the industry in the late 1990s, slightly lower than the total of 86 in 1990. Annual payroll for all employees was $423.8 million in 2000, up from $392.0 million in 1990.
The market for paper cups, plates, and other disposable paper products was healthy in 1990s. Despite the fact that these products are relatively difficult to recycle—most are contaminated with food or beverages after use—the category continued to grow throughout the decade. In the mid-1990s, manufacturers of sanitary food containers were able to answer some of their environmental critics by including recycled fiber in their products. This was made possible when the Food and Drug Administration (FDA) issued guidelines for the use of recycled paper in products that come in contact with food. Also, the increased strength and grease resistance of paper products, particularly plates, allowed for their use in an increasing number of applications. Household use of paper cups showed no signs of abating.
Paperboard milk cartons have a formidable competitor in milk jugs made from high density polyethylene (HDPE). These plastic milk jugs captured a growing share of the milk market in the 1970s and 1980s, most particularly in the gallon size, but also in the half-gallon size. However, an extended decline in sales of paperboard milk cartons began to slow and even stop in the 1990s when it became widely known that paperboard milk cartons retain vitamins better than their plastic counterparts (fluorescent lights in dairy cases leach vitamins from milk in translucent plastic jugs). This knowledge led some dairies and consumers to once again favor paperboard. Also, major efforts to promote the recycling of milk cartons by milk carton manufacturers, notably International Paper Co., helped improve the appeal of this type of packaging. Product innovations, such as adding spouts with resealable caps to paperboard orange juice cartons, have also helped increase the use of carton packaging.
Because of paperboard milk-style carton's ease of storage and ability to withstand repeated access, additional domestic uses for it were developed. These included packaging for nondairy flavored drinks, fruit juices, dry pet foods, laundry detergents, candy, and hardware. Such alternative uses helped increase the sale of milk cartons: in 1980, nondairy carton tonnage accounted for only 13 percent of all milk-carton sales. By the late 1990s, that percentage had topped 32 percent.
Leaders in this industry include a mixture of major paper companies and independent converting companies. The leading company is Fort James Corp., manufacturer of Dixie Cups and other sanitary paper products. Other key market players include International Paper Company and Blue Ridge Paper Co.—both of which manufacture milk carton stock—Solo Cup Company; Sealright Company, Inc.; Keyes Fibre Company; and Imperial Bond-ware Inc. While many of these leading companies produce branded products, sales of private label products are very strong in key categories, such as disposable dishes. For example, private label products accounted for close to 50 percent of the disposable dish market (including paper and plastic) in the late 1990s. The leading paper disposable dish brand was Fort James' Dixie Livingware, followed by Keyes Fibre's Chinet brand. Fort James operated 11 tabletop/foodservice converting plants employing 3,300 people.
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United States Census Bureau. "Statistics for Industries and Industry Groups: 2000." Annual Survey of Manufacturers. February 2002. Available from http://www.census.gov .
U.S. Department of Commerce. Census Bureau. "Nonfolding Sanitary Food Container Manufacturing," 1997 Economic Census. Washington, D.C.: GPO, November 1999.
U.S. Trade and Industrial Outlook 1999. New York: McGraw-Hill, 1998.
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