'Addition of extra massive capacity by APP will aggravate the situation of market'

'Addition of extra massive capacity by APP will aggravate the situation of market'

Asia Pulp & Paper (APP) Sinar Mas is considering the construction of a paper production facility in the Raigad district of the western Indian state of Maharashtra. The site in Dherand village identified for the facility will have a capacity to produce 1.2 million MT of paper products including printing paper, tissue and packaging board. By 2025, Asia Pulp & Paper intends to begin its enormous capacity in India to produce WPP, tissue, and packaging boards

The many stakeholders in the paper business are briefly discussed in The Pulp and Paper Times on the APP's investment. We get a range of answers and criticism. Here is the opinion of Mr Vinod Agarwal, Director Paswara Papers Limited:

Meerut | 2023 | The Pulp and Paper Times:

Q: is Asia Pulp and Paper's (APP) 1.2 million MT capacity hurt big and small paper mills in terms of paper export? 

In my opinion such a massive production of 1.2 million MT per annum by Asia Pulp & Paper (APP) will sourly hurt the existing big & small Paper Mill in India & hamper the exports which are already on decline after Covid-19 Pandemic. A situation may arise for closure of small Mills.

Q: is this massive capacity good for the Indian market or will it derail market sentiments...please explain 

The Production of all grades of Paper & Board in India is already on higher side than its consumption. Because of already excess production by existing Paper Mills, the Paper Mills are having large stocks in their Mills. The addition of extra massive capacity by APP will aggravate the situation of market. As far as I foresee, there is no growth in the use or demand of these grades of Paper in near future to be produce by APP. Such grades of Paper are already available in abundance in market.

Q: APPs will manufacture WPP, Tissue and Packaging Grades. Will the local market of these grades experience a slowdown? how do Indian paper mills compete in these grades?

The production of WPP, Tissue & Packaging Grades to be produced by APP will all slowdown the Market as the Market with these grades is already flooded. It will be a great challenge for the Paper Mills to complete in these grades for the Paper Units particularly located in the 100 km approx. vicinity of the Unit of Asia Pulp & Paper (APP). In my opinion Indian Paper market is not ready to accommodate such huge production.

Q: Any other comment on APP's investment?

We appreciate the huge investment by APP in Indian Market; however at the same time also very much concern for the fate of existing Indian Paper Mills which shall be directly impacted by the huge proposed production of APP. Indian Paper Mills are already suffering shortage of recycled fibre & the Paper Units producing Paper by using 100 % Waste Paper are dependant on import of Waste Paper from outside the country. If APP plans to produce Pulp from Agro Residue or by using wood pulp, a sufficient quantity of Agri Residue or wood for making pulp in India is not sufficiently available.
 

Web Title: Addition of extra massive capacity by APP will aggravate the situation of market