PKG · 10-Q · 2026Q2 · Full report

Supply Chain Constraints

PACKAGING CORP OF AMERICA · 2026-08-07 · Importance 37 · Surprise 32

Freight rates increased significantly in the second quarter, primarily because of higher diesel fuel prices, and PCA expects freight costs to remain elevated in the third quarter. Recycled fiber prices increased throughout the first half of 2026 and are expected to continue rising, while higher mill production will increase fiber usage and costs. Higher freight and logistics expenses reduced Packaging profitability by $28 million in the second quarter and $42 million in the first six months. The company expects chemical and purchased-electricity costs to increase, while wood-fiber and natural-gas costs are expected to remain relatively flat.

Key facts

• PCA expects freight costs to remain at or around the elevated levels experienced later in the second quarter and higher on average for the third quarter. source
• PCA expects prices for recycled fiber to continue to increase and higher mill production will drive increased usage and higher costs. source
• PCA expects costs for chemicals and purchased electricity will be higher and will remain relatively flat for wood fiber and natural gas. source
• In the second quarter of 2026, export and domestic containerboard outside shipments decreased (19.0%) compared to the second quarter of 2025, with more containerboard being integrated into PCA’s corrugated products system. source
• PCA is party to certain physical commodity transactions related to natural gas supply contracts that qualify for the NPNS exception as of June 30, 2026. source