KeyBanc analyst Adam Josephson notes that International Paper (IP) this morning confirmed a containerboard capacity expansion. The conversion cost of $300M, equaling $667 per ton, is nearly double what Packaging Corp. of America (PKG) said it would spend on its own conversion, Josephson tells investors in a research note titled "Confirms a Containerboard Capacity Addition, Yet More Could Be Coming." With International Paper's conversion, the North America containerboard market will now have three "substantial" capacity additions in three years, the analyst adds, citing Kruger's 400,000 ton per year machine that started in May and Packaging Corp.'s 400,000 ton per year Wallula converted machine that will start in Q2 of 2018. Josephson says box demand will need to grow by 2% per year over that period for operating rates to remain stable. He thinks think 1%-2% box demand growth per year is a "reasonable assumption."