What is International Paper's 2026 Manufacturing Strategy?

International Paper (IP) wants to become a global leader in sustainable packaging through innovation, circular economy principles and its acquisition of DS Smith.

The company says it prioritises environmentally conscious fibre-based packaging solutions while enhancing operational efficiency, advancing forest management practices and implementing digital technologies.

The restructuring initiatives undertaken throughout 2024 and 2025 demonstrate IP's pivot from commodity pulp products towards premium packaging offerings.

Discussing the company’s targets, CEO Andrew K. Silvernail said during its Investor Day: “We’re driving a winning mindset within the company. We are all about sustainable, differentiated packaging.

“You’re going to see a strategy today that delivers excellence.”

Strengthening the North American market

In June 2025, IP unveiled a comprehensive set of strategic modifications designed to boost its North American market.

Its plan includes initiatives focused on sustainable packaging delivery in the region, including:

• Withdrawing from the modelled fibre sector and repurposing the Reno, Nevada site for packaging operations
• Shuttering a packaging plant in Marion, Ohio and a recycling operation in Wichita, Kansas
• Divesting its containerboard facility and related recycling plants located in Xalapa and Apodaca, Mexico.

These measures formed part of an extensive transformation initiated in 2024, aimed at developing a more concentrated and responsive packaging solutions provider, especially after completing the DS Smith acquisition in 2025, which established a major player concentrated on North American and Europe and EMEA markets.

The acquisition, finalised in January 2025, was valued at around US$7.1bn in an all-stock transaction, resulting in DS Smith shareholders holding roughly 33.7% of the combined entity.

According to IP, this transaction could deliver substantial shareholder returns and establish a global frontrunner in sustainable packaging, with emphasis on North American and European territories.

In a statement during the announcement, Andrew said: “The combination of International Paper and DS Smith will create the world’s leading sustainable packaging company.

“With a differentiated geographic footprint and an unparalleled suite of sustainable packaging products and services, we will accelerate growth, improve profitability and serve our customers even better.”

Performance across the enlarged footprint

During IP's third quarter earnings announcement in November 2025, the business highlighted advancement in what Andrew described as a "transformational journey", with particular attention to the integration with the London-headquartered firm.

At the start of 2025, IP and Andrew forecast US box shipments would increase by 1%, however by November this projection was revised to a potential decline of up to 1.5% for the complete year owing to trade uncertainties.

Andrew said during the earnings call: “While the markets are challenging, we are controlling our own destiny. We control our customer-centric approach, and that focus is working in North America.”

He added: “Our long-term ambitions remain. IP has the ability to deliver to the targets we laid out at Investor Day. In the medium term, however, the softer market this year and into 2026 has delayed our progress.

“We can deliver US$5bn of EBITDA [Earnings Before Interest, Taxes, Depreciation and Amortisation] in 2027 and continue to accelerate progress thereafter.”

Enhancing client satisfaction and reach

Despite challenges in areas, IP remains focused on the customer experience and sales in hyperlocal areas.

The business published a strategic update in late 2025, identifying its geographical presence as among its most significant competitive advantages, possessing one of the "most advantaged footprint in the industry".

The update says: "But our business is hyperlocal. Most of our competition happens within 250 miles of a customer's facility, which means we must win in each local market."

To accomplish this objective, the company is concentrating on superior packaging quality, punctual delivery and swift response capabilities.

Heading into 2026, the company states: “This is more than a shift and strategy. It is a complete transformation on how we operate, invest and serve our customers.”