Browse the exclusive featured interview of Mr.R.N.Agarwal, CMD, NR Agarwal Industries Ltd, A Leading Paper Mill of India, conducted by The Pulp and Paper Times.
Eighty Percent of Unplanned Downtime can be avoided by Planned Maintenance Shutdown- R N Agarwal
“We are also internally studying many types of different paper product making possibility with our new upcoming project which will be also based on 100% recycled” furnish. -Mr.R.N.Agarwal, CMD, NR Agarwal Industries Ltd.
Recently 'The Pulp and Paper Times' Team has got the opportunity to interact with Mr.R N Agarwal, CMD of NR Group. Here is the interview based on current market conditions for paper mills.
Q.Industry 4.0 concept has been in discussion widely. Industry 4.0 Characterized as a Self Organised Intelligent Ecosystems which is satiated by “Digitization, Automation, Smart Equipment, and Network”. How does NRAIL evaluate this concept? What are the strengths and weaknesses of NRAIL in the context of Industry 4.0 Concept?
Industry 4.0 is commonly referred to as the fourth industrial revolution which is based on the current trend of data exchange in manufacturing technologies. NRAIL is very much excited about the cyber-physical systems & the Internet of things as long as by implementing the same there is the reduction of losses and improvement in production efficiency. Our in house team is continuously thriving towards this goal and we have already progressed towards Industry 4.0 by implementing smart automation systems for improvement of operating efficiency. For example, NRAIL is currently producing paper by consuming one of the lowest possible specific power, water or steam amongst recycled based plants and continuously planned for investing to reduce the consumption values at a regular interval.
Q. Due to partial ban on Unsorted Imported waste paper in China and partial closure of Capacities, Indian Industry are stretching out its size in term of production and adding new facilities to meet the indigenous and global demand. A large quantity of imported waste paper with a significant surge in import such as 133% as registered April to Sep 2018 period. Now India is heading on the path of China, Unsorted Wastes have taken born and in coming years India may see Big Environment Problem. As NRAIL is the net importer of Imported Waste Paper, how does NRAIL see this problem and what are the best ways, NRAIL adopts to dispose of the generated mixed segregated waste?
NRAIL is producing paper from the waste paper by recycling it which itself is a big leap towards environment protection in comparison to the paper plants producing paper and board from wood-based virgin pulp. Yes, the imports have been increased after the China waste paper import ban, however, NRAIL’s total production is increasing as per its own course and this is purely due to NRAIL’s good brand reputation in the market. In view of waste, we have adopted some innovative methods which are 1st time tried in the paper industry and we are very much successful in the same. To name a few, installation of a Sludge drying system, Incinerator type boiler which uses plastic as fuel and sending all then solid waste to cement plants which are used as a fuel in place of coal in their kiln, Reverse osmosis plant to reuse of wastewater and reduce freshwater consumption etc.
“NRAIL undertakes fortnightly maintenance shutdown to counter the incidence of unforeseen downtime arising out of machine breakdowns. This resulted in 80% decline in the incidence of unplanned downtime improving robustness, capacity utilization and margins.”- Mr.R.N.Agarwal, CMD
Q.Paper is expanding its values in various other segments and still, there are many areas where paper can justify its uses. How does NRAIL take up this matter in the context of Research and Development? Will you share your success stories? Are you planning to launch any new product in the coming time?
NRAIL is on continuous progress in terms of R&D and new product launch. NRAIL’s internal R&D team is continuously monitoring the final paper properties through offline and online quality control systems to satisfy the customer with the best possible quality and minimum deviation from the quality standards. In terms of new product development, NRAIL has launched several new products in the last years and recently NRAIL has launched its premium-grade NR Copier based on 100% recycled grade. We are confident by this innovative recycled copier we shall replace the copier grades made from virgin fibre, thus reducing global carbon footprint. We are also internally studying many types of different paper product making possibilities with our new upcoming project which will be also based on 100% recycled furnish.
Q. These days, the market conditions are in favour of Indian Paper Mill such as shrinking of tax circle, down in paper raw material prices, improvement in paper demand and exploration of new markets. With these conditions, margins are improving. How NRAIL effectively invests its margin in the context to have an improved recognition?
NRAIL regularly infuse huge capital investment in the plants in order to compete for the market with regard to quality productivity and services.
Q. India is getting overwhelmed with the entry of Global Suppliers such as APP, Nine-Dragon as Paper Manufacturers and in future India may see some more global suppliers. How does NRAIL evaluate its global competency in the context of the presence of these global suppliers on Indian Soil?
NRAIL is very eager to have such a conglomerate at the Indian Industry and expects excellent competition based on operating efficiency and skills of papermaking. As Indian paper consumption is still 11 – 12 Kg/capita, NRAIL strongly believes there is a big potential of growth to reach the values of 40 – 50 Kg / Capita consumption figures which are of our neighboring countries of Asia. In line with the same Indian paper, the industry is going in the right direction and will have enough capacity demand available for existing paper company’s expansions and for new capacity addition from companies like APP, Nine-Dragon etc. The overall scenario gives an optimistic indication of the future of the Indian Paper Industry.
Q. As the paper is a low-cost product, freight cost plays an important role in restricting the market expansion of paper many times. To beat the freight cost, setting up a new plant could be a good solution? How does NRAIL evaluate this issue and is NRAIL planning to set up any new unit in India or out India?
Yes, this is right. Still in India freight cost plays a major role due to issues with infrastructure, however, there is continuous progress. We are mainly focusing on the local market i.e. western region which is the biggest market for paper in India and growing faster compared to the other regions. Also, we are focusing on exports and our products are very well appreciated due to the production of paper from recycled waste which is a green initiative. Keeping in mind the upcoming reducing trend of plastic-based packaging, NRAIL has decided to increase its capacity in packaging board grades made of recycled paper.
Q. NRAIL is considered as a net Manufacturer of Paper, In an interview, The president of IPAMA has claimed that the converting & corrugation market is still at 19% in comparison of the global converting market which is at 81% so there is ample scope for this market to grow in India. Is NRAIL planning to launch its converting product to have better in-house consumption of the paper in the future?
We are currently making our most of the products ready for final consumers. For example, we are delivering our board grades after sheeting as sheets and the copier grades with branded packaging. For our kind of products converting has not much left to do except printing. We are directly supplying to the printing houses and retailers.
Q. Paper Making Industry has been considered as a heavy debt industry. Repayment of Heavy debt requires better management decisions. NRAIL is smoothly fulfilling its financial liability through its better management. What are those management's key decisions, on the basis of that, the debt is taken and repayment is made in time?
For a capital-intensive business, operational efficiency is the main yardstick. Since realizations in the paper industry are market-driven and one has little control over it, it is important to improve cost efficiencies and improve productivity. NRAIL undertook fortnightly maintenance shutdown to counter the incidence of unforeseen downtime arising out of machine breakdowns. This resulted in 80% decline in the incidence of unplanned downtime improving robustness, capacity utilization, and margins.
Initially, the company consumed an inferior grade of waste paper to moderate costs. However, after FY17, NRAIL started importing 50% of its raw material requirement which contained a higher proportion of virgin paper. This enhanced product quality and strength and moderated resource consumption resulting in better realizations and margin. All these measures have helped in maximizing the yields from one ton of waste paper leading to enhanced margin and competitiveness. This definitely helped for timely repayment of heavy debt repayment.