Tariffs Are Reshoring Supply Chains. That Is Good News for Recovered Fiber.

The U.S. tariff environment in 2026 is the most aggressive in decades. Section 122 tariffs of 10% took effect on February 24, 2026, with a threatened increase to 15%. Sector-specific tariffs on steel, aluminum, and other materials have been in place since 2025. Retaliatory measures from trading partners — particularly China — have added further complexity. The recycling industry is not immune to these forces. But unlike many sectors where tariffs create only costs, the recovered fiber market is positioned to benefit from the reshoring trend that tariffs are accelerating.

The Reshoring Effect

Tariffs make imported goods more expensive. When the cost of importing finished products rises, manufacturers have an incentive to produce domestically. This is the stated goal of tariff policy — to bring manufacturing back to the United States.

The data on whether this is actually happening is mixed. Manufacturing employment has declined by approximately 98,000 jobs during the first 12 months of the current tariff regime, according to Bureau of Labor Statistics data reported by the Associated Press. Production capacity at manufacturing plants has also dropped. These numbers suggest that the short-term effect of tariffs has been disruptive rather than productive.

However, the picture is more nuanced for specific sectors. Corrugated packaging production — the industry that consumes OCC — is tied to domestic economic activity, not imports. When more goods are manufactured, warehoused, and shipped within the United States, more corrugated packaging is needed. And when more corrugated packaging is produced, more OCC is consumed as a raw material.

The Packaging Demand Chain

The connection between tariffs and OCC demand runs through the packaging supply chain:

Step 1: Tariffs increase the cost of imported finished goods. A 10% tariff on imported consumer electronics, appliances, or industrial equipment makes domestic alternatives more competitive.

Step 2: Some production shifts to domestic facilities. Not all of it — and not immediately — but at the margin, tariffs incentivize domestic production. Companies that were sourcing from overseas begin evaluating domestic manufacturing options.

Step 3: Domestic production requires domestic packaging. Every product manufactured in the United States needs to be packaged, shipped, and delivered. Corrugated cardboard is the dominant packaging material for industrial and e-commerce applications.

Step 4: Corrugated board production requires OCC. U.S. corrugated board mills use recycled fiber (primarily OCC) as their primary raw material. The American Forest & Paper Association (AF&PA) reports that U.S. cardboard recycling rates are approximately 69–74%, with more than 33 million tons of corrugated cardboard recovered annually.

This chain means that tariff-driven reshoring, even if modest in scale, creates incremental demand for OCC at the end of the supply chain.

E-Commerce Amplifies the Effect

The reshoring effect is amplified by the continued growth of e-commerce. The global e-commerce packaging market reached $78.4 billion in 2025 and is forecast to grow at a 4.8% compound annual growth rate through 2031, according to Resource Recycling's coverage of industry data published in March 2026.

E-commerce is packaging-intensive. A product that might be sold in minimal packaging at a retail store requires a corrugated shipping box, void fill, and often an outer shipping container when sold online. This means that every dollar of economic activity that shifts from retail to e-commerce generates more corrugated packaging demand — and more OCC demand.

Tariffs accelerate this dynamic by making imported goods more expensive at retail, which pushes more purchasing online where consumers can comparison-shop more easily. The result is more e-commerce volume, more packaging demand, and more OCC consumption.

The Moulded Pulp Opportunity

Beyond traditional corrugated board, there is a growing market for moulded pulp packaging — the material used for egg cartons, electronics packaging inserts, and increasingly for food service containers as a replacement for polystyrene foam. According to Smithers, the moulded pulp packaging market is projected to reach $4.7 billion in 2026.

Moulded pulp is made from recovered fiber, including OCC. As this market grows, it creates additional demand for the same raw material that corrugated board mills consume. For OCC suppliers, this diversification of end markets is positive — it means that demand for recovered fiber is not solely dependent on corrugated board production.

What This Means for OCC Suppliers

The tariff environment creates both challenges and opportunities for OCC suppliers:

Domestic demand is structurally supported. Even if export markets are disrupted by retaliatory tariffs or shipping disruptions, domestic demand for OCC is underpinned by the reshoring trend and e-commerce growth. This provides a floor for domestic prices.

Quality premiums may widen. As domestic mills increase utilization to meet packaging demand, they become more selective about input quality. Clean, well-sorted OCC11 and DSOCC will command larger premiums over lower grades. Suppliers who invest in quality will capture more value.

Logistics matter more. With tariffs adding cost at every stage of the supply chain, transportation efficiency becomes a competitive advantage. Suppliers located near major mills or with access to efficient rail and truck routes will have lower delivered costs and higher margins.

What This Means for Buyers

Secure domestic supply relationships. If reshoring increases demand for corrugated packaging, mills will need more OCC. Building reliable supply relationships now — before demand tightens further — is prudent.

Watch for price increases. Sonoco's announced $70/ton price increase on recycled paperboard (effective April 3, 2026) is an early signal that major consumers expect input costs to rise. Other mills may follow.

Consider long-term contracts. In a rising-demand environment, spot purchasing exposes buyers to price volatility. Long-term supply agreements with quality-focused suppliers provide price stability and supply security.

The Bigger Picture

The recovered paper pulp market is projected to grow at 14.7% annually from 2026 to 2033, according to industry analysis published on LinkedIn. This growth is driven by sustainability mandates, packaging demand, and the economic advantages of recycled fiber over virgin pulp.

Tariffs are one factor among many, but they are an important one. By making imported goods more expensive and incentivizing domestic production, tariff policy is creating structural demand for the recycled raw materials that domestic manufacturing requires. For OCC suppliers and buyers who position themselves correctly, this is an opportunity.

Conglobus International supplies OCC11 and DSOCC to mills across North America and internationally. If you are looking to secure consistent, quality-verified supply in a tightening market, contact us.