Paper Mills should procure high strength raw material aggressively, reverse trend by July

Paper Mills should procure high strength raw material aggressively reverse trend by July

Paper Mills should procure high strength raw material aggressively, reverse trend by July

The COVID 19 Pandemic has collapsed the waste paper market significantly across the world; India is also suffering from the disrupted supply of high strength waste paper for its paper manufacturing. The estimation of a streamline of the waste paper supply chain is projected to improve from Q2 onwards; normalcy will prevail in paper recovery and we could see corrections in prices soon. The Pulp and Paper Times has an exclusive interview with Mr. Jay Kedia, Director at Cellpap to get more insights on the situation.

Established in 1985, Cellpap is one of the largest importers of Recycled Fibers, Wood Pulp, Steel Scrap and Paper into India. Keeping quality as our standard, we trade in quantities upwards of one million metric tons per year.

2450

7970

410

2100

Q) Being a reputed & experienced waste paper supplier, how do you evaluate the current waste paper scenario particularly for India and the whole Asian market? In the current situation, will the imported waste paper system and local collection system be sustained?   

The collections across exporting countries are at record lows and I do not expect them to generate in any big way for the coming few weeks. The waste paper will remain a concern for the next few weeks but at the same time sales of finished goods too are badly hit which will keep prices in check. I don’t expect prices to keep going up, in fact, we could see corrections in prices soon.

Q) Freight is the most prominent factor and it plays a major role in deciding the price of finished paper, how do you suggest paper mills to have low logistic cost? May Group procurement of waste paper reduce the freight cost to the paper mills?

Freights are a challenge especially in this time of container imbalance where trade has stopped. Group procurement does not reduce costs and in fact, in strong markets can even increase costs. I think its very important for mills to keep looking out for high strength material with their supply chains and procure aggressively but also keep the lead time in mind as markets could see a reverse trend by July once this panic is behind us.

Q) The whole world has been under lockdown, India usually procures high-grade waste paper from Europe and America, Now Import pipeline is totally disrupted, How this situation will impact on Indian paper mills profitability and productivity?

The supply chain is affected and will lead to reduced availability of supply for high strength kraft. Prices for high strength kraft will see a sharp increase temporarily.

Q) Indian Paper Industry is blossoming, expansions in paper plants are taking place but the recovery rate of waste paper in India is still at 27% forcing paper mill owners to import the recycle fibres. How do you advise to increase the recovery rate in India? 

This will remain a challenge and imports of raw material is the only option to bridge the gap. Some larger mills are setting up collections hubs but that is to secure their tonnages again the other, collections in India will only increase once municipalities and government work collectively towards education awareness and stricter implementation of dry & wet waste.

Q) What major changes or global trends you are anticipating in the waste paper market in coming two to three years to get rid of the problem?

Not in a position to comment on 

Q). If we see the post-COVID-19 situation, the Indian paper industry looks to be a cash-short industry on operation parameters, How can paper traders support the paper mills to come on the pre-COVID-19 production track in a faster manner?  

Everyone needs to be careful and procure material which is in tune to their requirement only. I think paper mills will not have enough orders to run 100% so one should anticipate 60-70% production and plan their raw material procurement accordingly.

Buy Paper Trade Directory 2019 (Latest Data of 500+ Indian Paper Mills) Avail Discount upto 25%

Published at : Jul 10, 2022 01:45 PM (IST)

Total Views : 9095