Fresh price hikes: HW pulp prices touch USD 615/MT; revocation of forest harvesting licenses is exerting cost pressure, ITC-PSPD reports Q3 FY26

Fresh price hikes: HW pulp prices touch USD 615/MT; revocation of forest harvesting licenses is exerting cost pressure, ITC-PSPD reports Q3 FY26

- ITC-PSPD says, in Q3, higher wood availability was partly offset by severe cyclones in harvesting season, keeping wood prices elevated; prices are expected to moderate going forward.

The Pulp and Paper Times

Rising input costs, firm global pulp prices, and strong seasonal demand have prompted major paper manufacturers to announce fresh price increases in early 2026. Escalation in pulp, chemicals, fuel, power, and logistics costs, coupled with currency depreciation and supply-side disruptions, has significantly impacted cost structures across the industry. At the same time, healthy demand from publishing, notebook, and institutional segments continues to support market momentum. In response, leading players such as BGPPL, and Asia Pulp and Paper have initiated phased price revisions to partially offset cost pressures and ensure long-term business sustainability amid evolving market dynamics.

“With reference to our continuous market communications regarding the sustained escalation in operating costs, we wish to reiterate that the cost environment continues to remain challenging amid geopolitical uncertainties,

“With HW Pulp prices firmly established north of USD 615 PMT, reflecting an increase of over USD 125 PMT from the lows seen just a few months ago. Supply conditions continue to tighten, driven by scheduled maintenance shutdowns at several global Pulp Mills during Q1 2026. In addition, Wood shortages in Indonesia following the revocation of multiple forest harvesting licenses by the Govt., along with rising Woodchips prices from Vietnam, are exerting additional upward cost pressure. The depreciation of INR is compounding this cost.” Bilt Graphic Paper Products Limited (BGPPL) informed all channel partners and dealers in its circular dated February 2, 2026.

On the demand front, market momentum continues to remain strong, supported by healthy seasonal demand from Publishing, Notebook, and Institutional segments, along with steady order inflows across Writing & Printing grades. 

Asia Pulp and Paper (APP) informed all Indian channel partners and dealers in its circular dated January 27, 2026, that In light of the current raw material and freight cost soaring, we have faced a number of challenges that have impacted our operational costs. In APP we always serve our customers with the best and consistent quality on regular and timely basis. In order to keep smoothly supply to our customers, it has become necessary to initiate the price increase to sustain the business. Thus, we are announcing the price increase USD50/MT for uncoated paper and USD30/MT for coated paper effective immediately.

“One of the most pressing concerns across paper mills is the continued volatility in pulp and waste paper prices. Global pulp markets have seen sharp price corrections over the past year due to changes in demand from major importing countries, inventory adjustments, and currency fluctuations. At the same time, recovered paper availability remains inconsistent, influenced by consumption trends, logistics costs, and export dynamics.” Mr. Ayush Mittal, MD of Shitla Papers said in his LinkedIn post.

BGPPL stated that In view of the above and to partially offset the sustained cost escalation, we shall apply P6 (+ 1,000 Rs PMT), applicable across all grades and both units (BHU & BPU), except C1S, C1S SP & Copy Paper with effect from 11.02.2026. 

With this increase, the cumulative price increase from P0 now stands at Rs 6,000 PMT (~USD 60). Our phased approach (~USD 10 per increase) continues to ensure a smoother transition while responding responsibly to the rapidly rising cost environment. This remains substantially lower than the typical USD 30–40 step increases witnessed across Asian markets.

Given the prevailing Market conditions, further price revisions are expected by the Feb end & further in Mar’26.

“For Indian paper mills in particular, dependence on imported pulp and waste paper exposes manufacturers to international price movements and freight costs. While some stabilization has been observed recently, uncertainty remains a key factor shaping procurement and pricing strategies.” Mr. Mittal said.

ITC-PSPD Reports Q3 FY26 Performance Amid Challenging Industry Environment

ITC's Paperboards and Specialty Papers Division (ITC-PSPD) has disclosed its financial results for the third quarter of FY25-26, revealing a 2.7% year-on-year increase in revenue, totaling INR 2,202 crore. Competitive pressures from low-priced Chinese supplies in global markets, sluggish domestic demand, and high wood prices & subdued realisation are creating a challenging environment for the paper sector, ITC said in its media release.

ITC-PSPD has reported a PAT of INR 198 crore for Q3 FY26, reflecting a 3.7 % year-on-year decline, compared to INR 205 crore earned by the paper segment in Q3 FY25. However, paper segment performance improves sequentially with profit up 3.6% (margins up 40 bps QoQ).

Performance includes impact of planned shutdown for maintenance of High Pressure Recovery Boiler & Paper machines.

Overall Industry remains impacted by low-priced supplies, high wood prices & subdued realisations - Minimum Import Price has been imposed on Virgin Multi-layer Paperboard, effective 22nd August’25; green shoots of improvement in net realisations during the quarter.

Proactive interventions by the Business over the past few years have led to improved wood availability; however, during the quarter, higher wood availability was partly offset by severe cyclones in harvesting season, keeping wood prices elevated; prices are expected to moderate going forward.

Continued focus on accelerating plantations in core areas, developing new areas, collaborating with other wood-based industries and implementing satellite-based plantation monitoring systems, among others.

Industry continues to represent to policy makers for extension of MIP and sustained safeguard measures in respect of low-priced imports of paperboards and coated/uncoated paper.

The Packaging and Printing Business witnessed robust growth driven by both Flexibles and Cartons. The Business remains focused on accelerating new business development, offering innovative and customised solutions.

The sustainable paperboards/packaging solutions portfolio maintained its strong growth momentum leveraging cutting-edge innovation platforms and has grown to 2.4x over the last 4 years.
 

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