Smurfit Kappa shares rise 3% on upturn in Europe

Smurfit Kappa shares rose 3% as the international box-packaging firm posted rises in revenue and margins on the economic recovery in the EU. It said demand for recycled containerboard had reduced stock levels in Europe, while global demand for kraft liner, or packaging paper, meant supply was “extremely tight”. Shares of packaging firms such as Smurfit Kappa tend to slide during world economic downturns because it is very difficult to close capital-intensive mills.

Smurfit Kappa shares rose 3% as the international box-packaging firm posted rises in revenue and margins on the economic recovery in the EU. It said demand for recycled containerboard had reduced stock levels in Europe, while global demand for kraft liner, or packaging paper, meant supply was “extremely tight”. Shares of packaging firms such as Smurfit Kappa tend to slide during world economic downturns because it is very difficult to close capital-intensive mills.

Global growth can boost paper firms because packaging materials are used in so many consumer products.