Kraft Paper Market – Global Industry Size, Share, Trends, Opportunity, and Forecast, Segmented By Product (Specialty Kraft Paper, Sack Kraft Paper), By Grade Type (Bleached, Unbleached), By Distribution Channel (Offline, Online), By Region, By Competition, 2021-2031F

Forecast Period	2027-2031
Market Size (2025)	USD 19.31 Billion
CAGR (2026-2031)	4.89%
Fastest Growing Segment	Online
Largest Market	North America
Market Size (2031)	USD 25.72 Billion

Market Overview

The Global Kraft Paper Market will grow from USD 19.31 Billion in 2025 to USD 25.72 Billion by 2031 at a 4.89% CAGR. Kraft paper is a durable, high-elasticity paperboard produced from wood pulp through the kraft process, characterized by its superior strength and tear resistance. The market is primarily propelled by the robust expansion of the e-commerce sector, which necessitates resilient shipping materials, and the global strategic shift toward sustainability, where industries are increasingly substituting single-use plastics with biodegradable paper alternatives. These drivers are fundamental to the market's upward trajectory, supporting increased adoption across industrial and consumer packaging segments.

One significant challenge that could impede market expansion is the volatility of raw material costs, particularly wood fiber and energy, which creates pricing instability and pressures manufacturer profit margins. Despite this obstacle, the sector has demonstrated considerable resilience. According to the Confederation of European Paper Industries, in 2024, packaging paper and board demand increased by 8.6% compared to the previous year. This figure highlights the continued robust consumption of kraft-based solutions even amidst economic fluctuations.

Key Market Drivers

Rising Demand for Sustainable and Eco-Friendly Packaging Solutions currently stands as the primary qualitative catalyst reshaping the Global Kraft Paper Market. As environmental regulations tighten and corporate sustainability mandates expand, manufacturers are aggressively substituting single-use plastics with biodegradable kraft-based alternatives. This transition is reinforced by the superior end-of-life recovery rates of paper products, which incentivize brands to adopt kraft solutions for branding and protective purposes. According to the European Paper Recycling Council, July 2025, in the 'Monitoring Report 2024', paper-based packaging achieved a recycling rate of 83.1% across Europe, the highest performance among all packaging materials. This high recyclability quotient validates the material's dominance in the circular economy, driving consistent adoption across the retail and food service sectors.

Expansion of the Global E-commerce and Logistics Sectors serves as the critical volume driver, necessitating vast quantities of durable, tear-resistant corrugated materials for shipping. The surge in online retail has created a sustained requirement for kraft linerboard and containerboard to ensure product safety during complex distribution cycles. According to the American Forest & Paper Association, May 2025, in the '65th Paper Industry Annual Capacity and Fiber Consumption Survey', U.S. paper and paperboard production increased by 3.2% in 2024, a growth trajectory primarily led by the containerboard segment essential for shipping boxes. Furthermore, international trade of these industrial grades remains vigorous; according to the American Forest & Paper Association, January 2025, in the 'Q4 2024 Containerboard Quarterly Report', year-to-date production for export surged by 15.4%, highlighting the global connectivity and rising demand within the logistics network.

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Key Market Challenges

The volatility of raw material costs, particularly regarding wood fiber and energy, presents a formidable barrier to the sustained expansion of the kraft paper market. Fluctuating prices for these essential inputs create significant instability that ripples through the supply chain, forcing manufacturers to operate with unpredictable profit margins. When production expenses rise abruptly, producers often struggle to absorb these costs or pass them on to price-sensitive buyers immediately. This economic friction frequently compels manufacturers to prioritize operational efficiency over expansion, leading to the closure of marginal facilities and a reluctance to invest in new capacity. Such cost-driven contractions directly limit the industry's physical ability to meet rising global demand.

These financial pressures have a measurable negative impact on the sector's infrastructure and long-term growth potential. As companies streamline operations to protect profitability against cost spikes, overall production capabilities can shrink. According to the American Forest & Paper Association, in 2025, U.S. containerboard capacity declined by 0.9 percent in 2024 compared to the previous year. This reduction in capacity, despite the broader market's demand recovery, illustrates how persistent input cost volatility hampers the industry's readiness to support continuous market growth.

Key Market Trends

The Development of Bio-Based Barrier Coatings for Food-Grade Kraft is transforming the market by enabling paper to replace multi-layered plastics in applications requiring superior grease and moisture resistance. Manufacturers are increasingly deploying aqueous and dispersion-based coatings that maintain the kraft material’s repulpability while offering functional protection comparable to polyethylene laminates. This technical evolution is driving significant capital expenditure into specialized coating infrastructure to meet the rigorous demands of the food service and FMCG sectors. According to the Mondi Group, February 2025, in the 'Full Year Results Announcement 2024', the company successfully expanded its converting capacity by operationalizing a new extrusion line at its Coating Štětí facility in the Czech Republic specifically to support the growing market for functional food and non-food contact packaging.

Concurrently, the Substitution of Plastic Protective Void-Fill with Kraft Alternatives is reshaping the protective packaging landscape, driven by major retailers eliminating non-recyclable dunnage. This trend prioritizes the use of crumpled, recycled kraft paper over plastic air pillows, leveraging the material's ability to be curbside recycled alongside the outer shipping box. The shift is operationalized by the large-scale retrofitting of fulfillment centers with paper-dispensing machinery, significantly boosting the consumption volume of lower-basis weight kraft grades. According to Amazon, June 2024, in a press release detailing its plastic reduction milestones, the company replaced 95% of plastic air pillows with paper filler across its North American delivery network, a transition projected to eliminate nearly 15 billion plastic air pillows annually.

Segmental Insights

The Online segment is emerging as the fastest-growing distribution channel within the Global Kraft Paper Market due to the rapid digitization of B2B procurement and supply chain management. Industrial consumers and retailers are increasingly utilizing digital platforms to source packaging materials, driven by the convenience of bulk ordering and enhanced price transparency. This growth is further supported by the substantial expansion of the e-commerce retail sector, which necessitates efficient access to sustainable corrugated packaging solutions. Consequently, the shift toward digital purchasing methods allows suppliers to reach a broader global audience, thereby accelerating the expansion of the online sales segment.

Regional Insights

North America maintains a leading position in the global kraft paper market, driven by a widespread industrial shift toward sustainable packaging alternatives. This dominance is supported by strict environmental guidelines from the United States Environmental Protection Agency, which mandate the reduction of plastic waste and promote recyclable materials. Consequently, the food and beverage sector has increasingly adopted kraft paper for its biodegradability and strength. High consumer awareness regarding environmental impact further accelerates this transition, ensuring that the region remains a primary hub for the manufacturing and consumption of eco-friendly paper packaging solutions.

Recent Developments

• In November 2024, Billerud expanded its portfolio of medical packaging materials with the launch of MediKraft SealBase, a surface-treated kraft paper produced at its Skärblacka mill in Sweden. This new grade was developed as a high-purity base paper for synthetic cold seal coatings, providing a recyclable alternative to traditional latex-based solutions for non-sterile applications like plaster packaging. The paper features a machine-glazed surface to enhance print quality and runnability on converting lines. The launch underscored the company’s strategic focus on the medical segment, offering customers a material that ensures safety, traceability, and minimized environmental impact through responsibly sourced virgin fibers.
• In October 2024, Mondi introduced Ad/Vantage Smooth Brown Semi Extensible, a new high-performance kraft paper grade, at the Scanpack trade fair. This specialized paper was engineered to bridge the gap between traditional sack kraft and machine-finished grades, offering a unique combination of high puncture resistance, tensile strength, and a calendered surface for superior printability. The product is specifically designed for form-fill-seal applications involving sharp or heavy items like dry foods and building materials. By providing a coatable and heat-sealable surface, the material supports converters in creating recyclable, shelf-ready packaging that meets both durability and branding requirements.
• In July 2024, Smurfit Kappa and WestRock completed their multi-billion dollar merger to form Smurfit Westrock, debuting with a primary listing on the New York Stock Exchange. This strategic combination united two major forces in the paper and packaging industry, creating a global leader with an unparalleled geographic reach across 40 countries and over 500 converting operations. The merged entity is positioned to drive innovation in sustainable kraft paper and corrugated packaging, aiming to replace plastic with fiber-based alternatives. Executives highlighted that the transaction created the partner of choice for customers seeking diverse, renewable packaging solutions on a global scale.
• In May 2024, Mondi launched TrayWrap, an innovative secondary paper packaging solution developed to replace plastic shrink film for bundling food and beverage containers. This sustainable product utilizes the company’s Advantage StretchWrap, a high-strength, uncoated kraft paper grade sourced from renewable fibers. Designed in collaboration with a machinery partner, the solution ensures stability and stackability for transport while maintaining full recyclability in existing European paper streams. The launch addressed the growing demand for functional, plastic-free packaging options in the retail sector, demonstrating the versatility of kraft paper in securing goods such as coffee packs during transit.

Key Market Players

• Mondi
• Segezha group
• Klabin SA
• Billerudkorsnas
• Stora Enso
• Daio Paper Corporation
• Nordic Paper
• Gascogne Papier
• Glatfelter Corporation

By Product	By Grade Type	By Distribution Channel	By Region
Specialty Kraft Paper Sack Kraft Paper	Bleached Unbleached	Offline Online	North America Europe Asia Pacific South America Middle East & Africa

Report Scope:

In this report, the Global Kraft Paper Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• Kraft Paper Market, By Product:

• Specialty Kraft Paper
• Sack Kraft Paper

• Kraft Paper Market, By Grade Type:

• Bleached
• Unbleached

• Kraft Paper Market, By Distribution Channel:

• Offline
• Online

• Kraft Paper Market, By Region:

• North America
• United States
• Canada
• Mexico
• Europe
• France
• United Kingdom
• Italy
• Germany
• Spain
• Asia Pacific
• China
• India
• Japan
• Australia
• South Korea
• South America
• Brazil
• Argentina
• Colombia
• Middle East & Africa
• South Africa
• Saudi Arabia
• UAE