EU Containerboard: Destocking risks ahead, Downgrade MNDl

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EU Containerboard: Destocking risks ahead, Downgrade MNDl

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European Paper and Packaging

EU Containerboard: Destocking risks

ahead, Downgrade MNDI

Rating Change

Persistent market imbalance, earnings recovery elusive 16 June 2026

We see growing risk of weaker-than-expected European containerboard volumes in 2H, Equity

which is adding downside risk to sector earnings outlook. So far, initial Iran War cost Europe

inflation seems to have been recovered, but this was likely aided by at least some pre- Paper and Packaging

buying demand/ restocking. Underlying demand indicators continue to deteriorate into Reinhardt van der Walt >>

2H and supply-side discipline remains elusive. With a 2H market recovery becoming Research Analyst

increasingly uncertain (especially in mid-stream linerboard), we see less room for MNDI MLI+44 (UK)20 7995 9270

earnings upgrades in the short term. SW likely remains more resilient due to high reinhardt.vanderwalt@bofa.com

integration, hedging and more effective box pricing strategy. We mark-to-market George L. Staphos

Research Analyst

containerboard prices (modest impact on SW/ MNDI estimates) and lower MNDI volume BofAS

assumptions (already assuming conservative SW volumes). We downgrade MNDI to george.l.staphos@bofa.com

Neutral (rating B-2-8 from B-1-7) from Buy) on limited earnings upside/ catalysts Jason Fairclough >>

(destock risk into 2H26) despite attractive valuation. Retain Buy on SW, unchanged PO. MLI (UK)

jason.fairclough@bofa.com

Containerboard inventory build could unwind Paul Kirjanovs >>

EU Containerboard companies called out surprisingly resilient March-April volumes at 1Q MLI (UK)

results. Price hikes seem to be sticking as well, which points to at least some demand paul.kirjanovs@bofa.com

pull.