Fiber Cans, Tubes, Drums, and Similar Products

Fiber can and drum manufacturing is a mature industry, with growth at or below the rate of increase in the U.S. gross domestic product (GDP). From 1984 to 1997, the value of this industry's product shipments increased roughly 35 percent, from $1.69 billion to $2.14 billion, according to the U.S. Census Bureau. With an annualized growth rate of 2.7 percent, this industry ranked among the slower growing paper products industries but was still close to matching the country's average growth in GDP. However, after growing to $2.32 billion in 2000, the value of shipments in 2002 declined to $1.88 billion. This decrease reflected a general economic downturn in the United States. Sales grew modestly by 2005, reaching $2.07 billion, then increased again in 2007 to $2.32 billion.

The number of establishments in the industry was 244 in 2007, down from 258 in 2004 and 275 in 2000. In 2007 the industry employed 7,600 people, as compared to 8,434 in 2004. Total payroll was $313 million in 2007, and approximately 83 percent of employees were production workers.

According to Dun and Bradstreet's 2009 Industry Reports, New Jersey was the number-one state in terms of revenue in the fiber can, tube, and drum manufacturing industry in the late 2000s. California was second, and rounding out the top five were New York, Pennsylvania, Rhode Island.

Fiber cans, tubes, and similar products were by far the largest category of products manufactured by this industry in the 2000s, accounting for about 84 percent of shipments. Paperboard fiber drums, a larger-sized product, accounted for about 13 percent of total fiber cans, drums, and similar product shipments, and fiber cans, tubes, drums, and similar products not specified by kind made up the remainder.

Paper and paperboard (not including boxes and containers) represented the single largest category of materials used by the fiber can, tube, and drum industry. Metal closures and crowns for containers claimed the next largest share of materials costs, followed by sheet steel and strip and glues and adhesives. The total cost of materials for the industry in 2007 was $1.3 billion, up only slightly from the 2002 figure of $1.2 billion.

Like other paper product producers, the makers of fiber cans, tubes, and drums were using more recycled paperboard and less virgin paperboard in order to satisfy end-user demands. In the 2000s this industry appeared to benefit from the desire by consumers and the government to use more products made from recycled materials or materials that were more recyclable than competing products. This environmental factor was a distinct advantage for industry manufacturers because many competing products are made from plastic, which is perceived to be a less recyclable product.

The paper industry was a good customer as well as a supplier for the fiber can, tube, and drum industry. Many mills use heavy-duty fiber cores to wind their paper and paperboard rolls. These cores are either shipped in long lengths and cut at the mill or are precut by the core manufacturer. This market showed little sign of moving toward alternative products, such as steel cores.

The fiber drum has seen its market share decline as many industrial users tried to eliminate the use of disposable containers. For example, for regulatory reasons, the chemical industry is moving away from using drums of any kind, including fiber or metal. Instead, they are using more portable chemical feed containers that are dropped off by the chemical manufacturer and then picked up to be reused when empty.

Some of the industry leaders in this category are integrated manufacturers, in that they produce fiber cans, drums, and tubes as well as the paperboard from which they are made. Other fiber can, tube, and drum manufacturers are independent converters of purchased paperboard. One of the leading companies in this industry, Sonoco Products Co. of Hartsville, South Carolina, was an integrated producer. Sonoco posted sales of $4.1 billion in 2008 and employed 17,500 workers. Delaware, Ohio-based Greif Inc. was also a significant player, with 2008 sales of $3.7 billion and 9,600 employees. Other industry leaders included Anvil Cases Inc. of City of Industry, California, and Star Paper Tube Inc. of Arlington, Texas.

Value of U.S. exports in this industry reached $43.5 million in 2008. Imports, on the other hand, were worth about $20.5 million. Total domestic demand, according to Supplier Relations US LLC, was around $2.3 billion in the late 2000s.