Market diagnosis: Kraft paper markets are in a structural upcycle driven by capacity rationalization and rising input costs. North American 42-lb unbleached kraft linerboard is assessed at $950-1,020/st delivered US East as June price hikes of $40-50/ton take effect, following successful Q1 and Q2 rounds. European markets face acute sack kraft tightness after Mondi Steti's +210 kt expansion primarily targets e-commerce grades, while global capacity exits of 2.5-3.5 Mt in 2026 progressively tighten the market balance. US containerboard operating rates at 91.9% (AF&PA 2025) signal limited domestic supply headroom. E-commerce packaging demand, plastic-to-paper substitution, and rising energy costs (+18% YoY in Europe) reinforce price support. Procurement teams should secure H2 volumes early and diversify supply sources before further tightening.