"From Q1 2024, the commercial scale production line will produce up to 12.5m paper bottles annually": Pulpex's CEO
- Pulpex bottles are sustainable, scalable, single-mould branded designs without material compromise
- We have no fundamental concerns about the cost of sustainable packaging
- Carbon footprint of Pulpex bottles is 90% less than glass and approximately 30% less than PET on a bottle-by-bottle basis
Recently, The Pulp and Paper Times spoke to Mr Scott Winston, CEO, PULPEX, and discussed the market scenario and various aspects of sustainable packaging, technological innovation to deliver much-needed and highly anticipated eco-packaging category change. Pulpex's patented technology enables brands to rethink their packaging proposition and achieve their sustainability goals. He discloses about the opportunity for fibre bottles and the consumer usage. Here are his full views:
Q: Please give us a brief Introduction of Pulpex and its operation.
Pulpex is a unique, first-of-its-kind, fully recyclable fibre packaging solution that uses technological innovation to deliver much-needed and highly anticipated eco-packaging category change.
Producing bottles that degrade readily in the natural environment, Pulpex's patented technology enables brands to rethink their packaging proposition and achieve their sustainability goals, whilst our partnership network gives us the ability to convert end-products at an industrial scale.
Never before has the collective need for sustainable and scalable packaging innovation been greater which is why Pulpex proudly partners with brand owners to deliver options that are more fit for purpose and which integrate into packaging manufacturers' existing infrastructure.
Q: Please shed some light on Pulpex's paper bottle and its sustainability.
Single-use packaging issues have reached an environmental tipping point. Globally more than 1.3 trillion glass and plastic bottles are produced each year and the volume of plastic waste entering our oceans is set to triple by 2040.
As we look at the opportunity for fibre bottles and the consumer usage occasions for them, we recognise that a fibre packaging solution will never be a viable direct replacement for all situations.
Pulpex allows brands to consider potential options for supplementing glass and PET bottles and, on many occasions, replacing its usage altogether. Pulpex bottles deliver significant improvements on the carbon footprint of glass bottles. The carbon footprint of Pulpex bottles is 90% less than glass and approximately 30% less than PET on a bottle-by-bottle basis. Pulpex bottles are also fully recyclable in standard paper/card waste streams, Globally, paper/card is recycled at a much higher rate than plastic.
Our unique offering harnesses the strength of sprayed barrier coatings which enable functionality vs end of life recovery and recycling and is why we are part of the 4evergreen cross-industry alliance.
Q: Moisture, gas, water, oil, and grease create a limitation in paper packaging. How much Pulpex trusts its coating solutions to overcome this limitation?
When Diageo developed the technology that would enable them to form 3D shapes from sustainably sourced wood pulp, they turned to technology partner BASF to help make this into a viable product. Wood pulp, when formed into a bottle shape, will not itself hold liquid, so a technological solution was needed. Not only must the bottle hold liquid, but it also needed to be recyclable through the existing paper waste stream. It quickly became clear that different liquids required different barrier properties, both to protect the product from the environment and to prevent it escaping from the bottle.
BASF and Pulpex have been working together to develop this concept in close conjunction with its corporate partners to define the precise performance criteria for each liquid. The underlying mission was to develop a bottle that was renewable, biodegradable and recyclable through existing paper recycling schemes. The resulting fibre bottle is lightweight and offers brand owners a sustainable, environmentally-friendly alternative to plastic and glass bottles.
Q: How does your paper bottle differ from the ‘Tetra Pack’, as both are used for liquid packaging?
Whilst we use the same renewable resources as many of our competitors, Pulpex does not use aluminium foils or other laminates.
Furthermore, instead of standard cartons, Pulpex bottles are customisable by shape and size and allow for embossing/debossing, labelling and direct printing with food-safe coloured pigments and dyes to fit any brand's needs.
Q: What does one understand about Environmental, Social & Governance (ESG) in Packaging? Why is it becoming more demanding nowadays? How Pulpex see ESG concept?
Packaging typically represents 50% of a company's Scope 3 emissions and hence plays a key part in an any corporate sustainability initiative. Pulpex is seeking to make a fundamental impact on this carbon footprint issue. Pulpex directly answers the problem of packaging performance matching its usage needs by creating fibre packaging solutions that deliver brand equity (customisable shapes, sizes and designs), technically perform (compatible with brand's existing filling infrastructure and standard paper waste streams) and, if not recycled, degrade readily in the natural environment leaving no unintended legacy.
Q: Any product’s impact comes not just from the product itself, but also from how it’s packaged and delivered to the customer. At Pulpex, how do you evaluate the perception of new-age consumers about compostable and sustainable packaging? Does the packaging keep an ‘edge’ on the Products?
Consumers’ respect for environmental issues and their changing behaviours are driving demand for renewable, recyclable, biodegradable and minimal plastic packaging. In fact, 61% of consumers are likely to switch to a brand that is more environmentally friendly than their current brand.
Furthermore, retailers are increasingly targeting zero-waste and circular economy principles for their packaging, while governments are taxing packaging materials and principles and that do not tackle or address these issues. As such, brands have all been seeking solutions, but economically viable and ready-to-go options have proven to be limited… until now.
Pulpex bottles are sustainable, scalable, single-mould branded designs without material compromise that significantly reduce the reliance of single-use plastics. With customisable shapes and designs, it offers all brands the opportunity to rethink their packaging proposition at scale.
Q: There have been more stories about the ‘Greenwashing’, especially for Paper Bottles and Food grade packaging. What is the truth behind this ‘misconception’? Don’t you think Greenwashing in developing countries is deceiving consumers?
With increasing desire and pressure on companies to be net-zero, there is inevitably some (occasionally unintentional) 'greenwashing' by brands across all sectors, including packaging. Pulpex however is proud to be the world's first, commercially scalable packaging technology capable of producing genuine paper bottles made of 90%+ sustainably sourced fibre and designed to be recycled in standard paper waste streams.
Q: Please let us know the plan of Pulpex to scale up its production facility across the world, and especially what plan for India?
From Q1 2024, the commercial scale production line will produce up to 12.5m paper bottles annually in Cambridgeshire, UK. Additional capacity will become available in targeted geographical locations globally via licensed manufacturing partners from mid 2024 including. This includes India, where we remain open to discussions with interested parties who, if interested, are free to contact us via email@example.com
Q: The production of packaging from virgin materials – whether plastic or paperboard or pulp – is nearly always more taxing on the environment than using recycled material, which is why recycling matters. How does Pulpex think about the circular economy of paper bottles? Is any plan you have?
Recycled fibre cannot be used for food and beverage products due to food safety concerns. Pulpex technology is flexible to available fibre sources and is compatible with both virgin materials and recycled fibres.
Made from sustainably sourced wood pulp that is PEFC-accredited and FSC-certified, Pulpex holds both PEFC and FSC Chain of Custody certifications.
Our bottles are widely recyclable and can be recycled in standard waste streams as you would normally recycle paper and card. As global recycling rates are far higher for paper and card than for plastic, fibre-based packaging has a much higher chance of actually being recycled and becoming more ‘circular.’ In the event a Pulpex bottle is not recycled, it will degrade readily in the natural environment.
Pulpex is also a member of 4evergreen, a cross-industry alliance of over 100 members representing the entire lifecycle of fibre-based packaging – from forests to designers, producers, brand owners and recyclers.
Q: What is the Life Cycle Analysis (LCA) of paper-based packaging? In the latest Interview with The Pulp and Paper Times, World Packaging Organization (WPO) has claimed that there is seven times less impact if we go for the plastic bag and even more so if we recycle that plastic. it is not just a bottle or box, no there’s a lot of science and technology that goes behind the creation of that particular packaging component. How do you take this claim in your innovation?
Whilst plastics are recyclable, their recycling rates are relatively low compared to fibre packaging. As such, a fundamental aspect is that fibre as a category has a much higher recovery rate than other materials and if it does escape, it degrades readily in the natural environment without any legacy impact on the environment.
As mentioned earlier, fibre packaging is not the answer to all packaging situations. The planet needs further advances in plastic, metal and glass packaging to the help with its global carbon footprint but we remain excited to see the developments in other packaging fields.
Q: What is the market size of liquid packaging? How would it grow in next five years?
Globally more than 1.3 trillion glass and plastic bottles are produced each year and, with an ever-increasing global population, it is hard to imagine anything other than demand increasing over time.
Q: We are aware that the fibres get shorter and shorter as it's recycled, and we can make products out of paper and board that lend themselves to better recycling and that can be recycled more than the figure of seven times. How do you support Pulpex’s bottle longer recyclability vs plastic?
Pulpex can use either virgin or recycled fibre in its bottles and does not reduce the quality of the fibres in its bottle making process. Post consumer use, the bottles can enter standard paper waste streams and go on to become other robust, paper-based products.
Q: packaging cost counts on retail products; companies are more aware about the pricing of products and want to keep it suitable for consumers. How do we evaluate a price of a sustainable bottle against a plastic bottle? Do you think that it will sustain in the long run?
YES - All brands have mixed packaging material portfolios. Given Pulpex's breadth of engagement with leading consumer brands across the globe (see www.pulpexhome.com<http://www.pulpexhome.com/> for more information), we have no fundamental concerns about the cost of sustainable packaging.
JMC Paper Tech forged a technological partnership with Hergen, introducing cutting-edge advancements in tissue-making technologies
- Cutting-edge advancements in Tissue, Shoe Press, Hydraulic Headbox, Film Press, and Yankee Cylinders technologies
The Pulp and Paper Times | 2nd December 2023
JMC Paper Tech and Hergen have strategically united to form a robust Technology Partnership, aiming to introduce cutting-edge advancements in Tissue, Shoe Press, Hydraulic Headbox, Film Press, and Yankee Cylinders technologies. This collaborative effort goes beyond a traditional business alliance, evolving into a synergistic relationship that leverages the unique strengths of both companies. The partnership aims to deliver state-of-the-art solutions that optimize efficiency and quality in paper production across the regions of India, Bangladesh, Pakistan, the Middle East, and Africa.
Talking to The Pulp and Paper Times, Dr. Yesha Patel, CEO of JMC Paper tech informs that JMC has recently forged a technological partnership with Hergen, extending our collaboration to the Southeast Asian market. This strategic alliance is specifically aimed at catering to the markets in India, Bangladesh, Pakistan, the Middle East, and Africa, focusing on Tissue Machines, Film Press, Shoe Press, and Hydraulic Headbox technologies.
She further said, “This collaboration brings together JMC's extensive industry experience of almost 3 decades and Hergen's 45-year legacy as an industry leader in developing advanced paper-making technology. The synergy between the two companies ensures a powerful combination of innovative prowess and technological expertise.”
“By leveraging each other's strengths, JMC and Hergen are committed to delivering groundbreaking advancements in tissue-making machinery. This strategic partnership enhances JMC’s ability to provide comprehensive solutions to our clients, reaffirming our commitment to being a one-stop-shop that offers “Concept to Commissioning” solutions for all paper production needs. The inclusion of Hergen's technologies further strengthens JMC's position, allowing us to cater to a wider array of customer needs. The partnership is poised to redefine industry standards, contributing to the continuous progress of the global paper and board and tissue manufacturing sector.” She added.
Hergen is a Brazil-based industry leader with a 45-year legacy in developing state-of-the-art technology for the paper industry. Their expertise spans various areas, including shoe press, hydraulic headbox, film press, and Steel Yankee cylinder technologies. For more detailed information, you can explore their website at Hergen Website.
Satia Industries’ revenue declined by 19% due to reduction in paper prices in Q2FY24; upward trend in raw material prices
- Raw material prices have started to rise in the recent past, and this upward trend could potentially affect industry margins in Q4FY24
- Net profit stood at INR 479 Mn in Q2FY24, compared to INR 508 Mn in Q2FY23, a decline of 6% YoY.
The Pulp and Paper Times | 7 November 2023
Punjab, 04 November 2023: Satia Industries Limited (SIL) one of the leading wood and agro-based paper manufacturer in India, announced its results for the second quarter and half year ended September 30, 2023.
Revenue from operations came at INR 3,734 Mn in Q2FY24, a decline of 19% YoY, due to reduction in paper prices. Additionally, the company had taken maintenance shut down of its machinery, which has also impacted the production. Decline in prices was offset by reduction in raw material prices, due to which the gross margins were stable at 58.2% in Q2FY24 as compared to 59.1%/49.1% in Q1FY24/Q2FY23
Commenting on the financial results, Executive Director Mr. Chirag Satia, said “During the past quarter, the industry encountered significant challenges, primarily in the form of declining prices, which had a notable impact on our revenues. Our revenues decreased by 19% year over-year, totalling INR 3,734 Mn. Our continuous orders with State Text boards provided vital support in mitigating the effects of price declines, ensuring the stability of our gross margins throughout the quarter.
Net profit stood at INR 479 Mn in Q2FY24, compared to INR 508 Mn in Q2FY23, a decline of 6% YoY.
• Satia Industries has finished the first phase of wood pulping capex with installation of four digesters. Rest two will be installed during Q3
• The company is running two cutlery machines on trial. By end of Q3FY24, the company is expecting 6 more semi-automatic machines to come
It's worth noting that raw material prices have started to rise in the recent past, and this upward trend could potentially affect industry margins in Q4FY24. However, due to our integrated approach, Satia Industries is well-positioned to efficiently manage cost escalations. Moreover, our reliance on 50% of revenues from State Text Boards provides a valuable safeguard, allowing us to secure revenues at fixed prices and ultimately delivering good returns to our shareholders.
We remain committed on maximizing our operational efficiencies and optimizing resource allocation. As a result, we consistently undertake improvement projects in our facilities, even if they are of smaller scale, strengthening our capability to effectively navigate challenges. We have successfully completed the first phase of our wood pulping capex, and the remaining phase is set to become operational in the second half of FY24. Consequently, we anticipate reaping the full benefits of this capex in the upcoming FY25.”
• The management expects to achieve 5 to 7% growth in paper production
• The company is targeting ~200 bps improvement in the EBITDA margins in FY24 over FY23
Satia Industries Limited (SIL), is one of the largest Wood and Agro-based paper manufacturer in India. SIL was incorporated by Dr. Ajay Satia in 1980 and commenced its operations in 1984 with a small capacity of 4,950 tonne per year. It surprisingly overtook many of its peer in production achieve, to 2,09,910 MT in FY23 implying a capacity utilization of ~102%. SIL has successfully commissioned their PM 4 and has augmented its total installed capacity to 219,000 MTPA.
G20 summit halts paper mills production in North India; Kraft paper demand improves, Export may resume from November
New Delhi | 8 September 2023 | The Pulp and Paper Times:
Paper Mills in north India have stopped production for four days (7 to 10 September 2023) due to G20 Summit in Delhi restricting heavy vehicles movement in Delhi and cross border transition.
Talking to The Pulp and Paper Times, Mr Atul Bansal, MD, Maruti Papers Limited, Shamli said, Yes, The Delhi Government has issued a notification restricting heavy vehicles movement in Delhi due G20 summit, market will also be closed. We cannot send finished paper to sell as well source raw material like waste paper which primarily comes from Delhi. G20 summit will impact the production of western Uttar Pradesh's paper mills prominently.
A Gazette notification outlining a series of restrictions to be in place during the G20 Summit. These restrictions are aimed at ensuring smooth proceedings and enhanced security during the international event.
“Goods vehicles and commercial vehicles will not be permitted to operate on the few roads creating difficulties for paper mills to sell and source finished products and raw material respectively. These restrictions are also affecting to Uttarakhand, Haryana and Punjab paper mills forcing them to shut their production unit.” Mr Ashok Bansal, MD of Nikita Papers Limited said.
Mr Vinod Aggarwal, Director, Paswara Papers Ltd., told The Pulp and Paper Times, Mills are shut down for 5 days due to low demand of paper in the market, low price realisation due to over production.
On the demand front of kraft paper, Mr Ashok Bansal looks optimistic, he added, yes, demand has improved in past months and we hope it will sustain in coming months due to festive season.
Mr. Bansal also expresses his steadfast position on the export of kraft paper, saying that Indian paper mills anticipate that exports will resume in November or December when our competitive pricing due to the availability of inexpensive waste paper will allow us to export paper at a lower price than that of other nations' imports.
"One reason why paper mills are closing is because of the G20 Summit, but the reality is that overproduction means there aren't enough orders to keep the paper mill running. Due to a shortage of orders, they also want to preserve market sentiment. The Indian Recovered Paper Traders Association's (IRPTA) president, Mr. Naresh Singhal
Regarding the cost of waste paper, Mr. Singhal stated that the upper limit of price for waste paper is now hanging at Rs. 17/kg, while the lower price is Rs. 16.40/kg, while the price for finished goods has decreased to Rs. 27.50 per kg from Rs. 28.50, but orders have not yet materialised.
“As the prices of finish paper and board are not increasing as compared to the increase in waste paper rates. Waste paper stakeholders are delighted to feel that they will be able to receive the rates for their stocks which were previously stored at higher rates but the rates declined and those stockists were facing challenges of loss on their stocks.” Mr Singhal informed.
Prices of waste paper in India also gone higher accordingly. Look at the current rate trend in India Kraft/Corrugated waste paper in Punjab, Uttar Pradesh, Bihar, Jharkhand, West Bangal and North East states is approx average rate FOR Mills are from Rs 16000/ pmt to Rs 17000/ pmt. at different places.
Rates of Kraft waste paper in Central India i.e Indore, Bhopal, Nagpur, Jabalpur and surrounding areas are Rs 14300/to Rs 15000/ pmt while in Gujarat Rajasthan approx Rs 15000/ pmt to Rs 16000/ pmt.
As the price of imported waste paper gone up by $10 to 15$ per metric tons for Mix waste, OCC and apprrox 20/ 25 $ in SOP A grade, SWL Scan board and also Cup stock, he added.
Karnataka Rs 14500/to Rs 15500/ Andhra Pradesh and Telangana Rs 14000/to 15000/pmt
Collection level of corrugated waste paper is poor. Rains in Tamilnadu and Nizamabad and also some other regions of South India still continue.
Indian Kraft paper mills are expecting export orders from China; buoyancy in demand anticipates
New Delhi | The Pulp and Paper Times | 5 Feb. 2023:
The import of Kraft paper from India may once again be viable given the improvement in the COVID cases in China. Manufacturers and waste paper suppliers have been harmed by the recent sharp fall in kraft paper exports. The recovered paper costs decreased to a minimum in 2022, ranging from Rs 17 to 19 per kg.
The current market trend, according to Mr Naresh Singhal, president of the Indian Recovered Paper Traders Association (IRPTA), is "With the improvement in weather conditions, the market trends in finish kraft paper demand and also waste paper indicate and settle the direction of movement of Kraft paper in the coming week starting from February 6th for the rest of the month."
Mr. Singhal informed us that Indian Kraft paper mills, especially from Gujarat and South India are expecting export orders from China at higher prices compared to the previous orders received in December 2022.
According to Fastmarkets Report, Demand for US old corrugated containers (OCC) ticked up in January as recycled pulp mills in Southeast Asia seek more fiber at the start of the year, yet pricing for recycled brown pulp (RBP) remained unchanged at $340/tonne net CIF to China for the third consecutive month, according to Fastmarkets’ PPI Pulp & Paper Week January 18 pricing survey and market report. Contacts reported that market demand met supplies.
Some sellers reported RBP trades in January at higher prices, up slightly to $350- 360/tonne net CIF to China. However, the majority told of firm prices that held at $340/tonne net CIF to China.
On January 1, China lowered import taxes on 1,020 commodities, including 67 kinds of paper and paper converting products. Among them are corrugating medium, recycled linerboard, virgin and recycled boxboard, and both coated and uncoated freesheet paper. China has decided to waive the standard most-favored-nation (MFN) tariffs of 5-6% on imports of these grades until the end of this year.
China’s Ministry of Finance said that the tariff cuts would increase supply, and help its industrial chains and supply chains in China.
"Prices for recovered Kraft waste paper have increased by about Rs 2500/pmt in North India over the past 20 days, particularly in western Uttar Pradesh and Uttarakhand. In the same time frame, finish Kraft paper prices increased by Rs 3 per kilogramme. On January 10, 17, and 24, Kraft paper mills raised the price of finished paper by Rs. 1 per kg, for a total increase of Rs. 3. Due to the weak finish paper demand, these prices were accepted by the dealers about 4 to 5 days after the rate increase announcement date as Mr Singhal explained.
Kraft paper mills have further announced one more time price increase of Rs 1 per kg on 31 January 2023, The price of corrugated waste paper, Kraft waste paper has already touched level of Rs 20500/ in North Indian market. Paper Mills in and around Bengaluru Recovered Kraft Waste Paper rate ruling presently at ₹ 17/- per kg.
Mr. Singhal added, “As you are well aware of the price increase in imported OCC. I also want to share the information received from some of our association's member that the rates of imported European OCC quality 95/5 seems to be higher by approx $15 than earlier.
As reported by Fastmarkets, Buyers and sellers of recycled brown pulp (RBP) told P&PW that business is “better” in Southeast Asian countries, and the anticipation of China’s return after many months of lockdowns due to the pandemic that has kept workers and residents at home. As restrictions are lifted, the economy is expected to pick up again.
Price increases across the writing-printing sector, including copiers, will lay the foundation for the upcoming year
“We expect a balanced equilibrium between demand and supply in Q3 and Q4 of FY 23-24, leading to price stability in the market”
“We can now cater to smaller orders, allowing for increased market penetration”
Recently, The Pulp and Paper Times spoke to Mr Partha Biswas, Chief Sales & Marketing, JK Paper Ltd., and discussed the market scenario of writing and printing paper, copier, its price forecast, impact of NEP20 on paper demand, Imports of paper, and other issues pertaining to paper industry. Here are his views:
The Pulp and Paper Times | June 2023:
Q: As a marketing leader, what is the current market scenario for Writing and Printing paper and Copier segment? How do you anticipate the demand and price forecast post-Q1FY24?
In the copier segment, we anticipate steady growth of around 4-5% for FY 23-24, as demand has matched pre-COVID levels. Price increases across the writing-printing sector, including copiers, will lay the foundation for the upcoming year. Import levels are expected to be equivalent to pre-COVID times, while exports may decrease due to competitive global prices. However, the implementation of the National Education Policy (NEP) 2020 and the introduction of fresh curricula for certain subjects will fuel demand, leading to a good market outlook for FY 23-24. Although a slight dip is expected in Q2, stability in prices is anticipated once the publishing sector picks up in Q3.
Q: JK Paper is exercising demand sensing and forecasting driven through its digital initiatives; please explain this exercise. Also, JK Paper intends to launch more Quick Service centres for packaging board dealers. What is this all about?
Digital Demand Sensing utilizes historical sales data enriched with external data to create a machine learning-based analytical model. Its primary objective is to enable smart marketing and sales interventions by defining micro markets at various levels, such as cities at the ward level and districts/subdistricts for the rest of India. This approach helps determine the demand and growth potential of each micro market, allowing for targeted strategies.
QSC (Quick Service Centre): We have successfully reduced lead time by 6-8 days, enabling us to deliver better and more efficient service to all clients. Previously, small order quantities were not feasible due to Full Truck Load requirements. However, with the implementation of QSC, we can now cater to smaller orders, allowing for increased market penetration.
Q:There is a anticipation that Writing and Printing paper price might further increase by end of Q2FY24 owing to boost in W&P paper demand due to National Education Policy 2020. Do you think NEP2020 will bring more demand to the Industry as well as increased price?
With the implementation of NEP 2020, we anticipate a moderate increase in demand. However, this heightened demand will be met by an increase in imports. As a result, we expect a balanced equilibrium between demand and supply in Q3 and Q4 of FY 23-24, leading to price stability in the market.
Q: New pulping capacities have been added in countries like Brazil, Uruguay and China, which will become operational in this calendar year. With softness in global demand, global pulp prices will definitely come down. This may lead to an increase in imports into India. May we see the adverse impact of cheap Imports on domestic pricing in coming months? Please explain
Indian paper prices are directly linked to global prices, particularly influenced by pulp pricing. If there is an increase in pulp production, leading to softer pulp pricing, it will result in a correction of writing and printing prices globally. The competitiveness of global prices will drive further imports, prompting domestic manufacturers to adjust their prices accordingly.
Q: What does one understand about Environmental, Social & Governance (ESG) in the Paper and Packaging industry? Why it is becoming more demanding nowadays? Is it a step towards the GREEN company?
ESG in the paper and packaging industry involves prioritizing sustainable practices, responsible sourcing, and strong governance. It addresses environmental impacts, social responsibility, and ethical decision-making. It is becoming more demanding due to stakeholder expectations, regulatory pressures, investor influence, and consumer preferences. Embracing ESG is a step towards becoming a green company as it focuses on reducing environmental footprints, promoting social welfare, and ensuring long-term sustainability. By adopting ESG principles, companies in this industry can enhance their reputation, attract investment, and meet evolving market demands.
Q: One of the largest paper-making giant, Asia Pulp and Paper (APP), have received a land allotment letter to set up one of India's most extensive paper manufacturing infrastructure (1.2 million MTA). APP will produce WPP, Tissue and Packaging Grades in India; what is your view on this massive investment? Will the local market of these grades experience a slowdown? How do Indian paper mills compete in these grades?
There is still no clarity on this investment as and when there is any information coming out of APP, we will be able to comment on this.
Q: Govt. of India has brought the Import of Paper under Paper Import Monitoring System (PIMS) from 1st October. This order shall be applicable to a range of paper products, such as newsprint, handmade paper, wallpaper base, duplicating paper, coated paper, uncoated paper, and other grades of paper. Do you think this step will bring relief to domestic paper manufacturers? Trade Bodies call PIMS a ‘CURB’ on imports and do not provide a level playing field. What is your stand on this?
PIMS is a formal way of putting in all the details of imports including place of origin. Mandatory filling of this form will bring in more transparency in the business.
Q: Indian imports of paper and paperboard have jumped 47% in FY 2022-23, the highest jump has been in the imports of uncoated writing & printing paper at 102% followed by coated paper and paperboard at 51%. Don’t you think that above data shows demand –supply gap exist in the market which is not being penetrated by domestic manufactures?
FY 22-23 was the first full year post covid, where in the demand also was 100% and it touched the pre-covid levels. Similarly, the imports in the same time period though would have shown sharp increase over last year, but in reality, its at the same level as pre-covid times (FY 19-20) (to check- growth 10-15%).
Q: IPMA has also called for the issue of quality control orders (QCOs) by the Government on all grades of paper and making BIS certification mandatory. What is BIS? Can you shed light on this and how it will help Indian Customers?
The Bureau of Indian Standards (BIS) is responsible for developing standard specifications for various products, including different categories of paper. Photocopy paper falls under compulsory certification with the ISI mark. By adhering to these specifications and obtaining the ISI mark, customers can be assured of the quality of the paper they purchase.
Q: Please shed some lights JK Paper's offering to the Market, JK Paper intends to achieve over 100% capacity utilisation in its newly established board project at Unit CPM and higher cost efficiency in FY 22-23. What are JK’s offering in board sections and its edge on other players’ products? What growth prospects do you forecast in board section in coming two years?
FBB, SBS, Cupstock, Anti-Fungal B, Poly-coated – inhouse pulp production which ensures consistent quality of raw material which leads to consistent quality if FG, faster service and we are present close to market and establishment of QSC helps us to service customers faster.
Q: Paper industry is being obsolete by digital technologies and on the other side paper industry is leaning on digital platform/media to promote or launch their products, recently JK Paper Intended to launch like JK Copier plus (Antimicrobial) and JK Pac Fresh on digital media, As a marketing leader how do you justify this contradiction?
As we move towards a plastic-free economy, paper emerges as the best alternative to plastic. Therefore, we do not believe that digital technologies will hinder the growth of paper consumption in India. In fact, leveraging digital media provides us with a platform to reach out to a wide consumer base and raise awareness about our paper products. Additionally, the education and publishing sectors will always require paper for their regular operations, ensuring a consistent demand for paper.
Q Any marketing mantras or comments for the Indian Paper industry
JK Paper Ltd. is committed to achieving continuous growth through effective marketing strategies. We emphasize the importance of innovative product development, establishing strong customer relationships, and gaining insights into customer preferences to enhance satisfaction. The company proactively analyzes future demand trends, evolving consumer behavior, global market dynamics, and the impact of related industries. With this comprehensive understanding, we develop sustainable marketing strategies aimed at driving profitable growth in the long term
New paper machine has been designed keeping in mind the requirement of corrugators in the international market: Aryan Paper Mills
-We have a base of repeat active international customers which are testament to our dedication to quality
In an exclusive interview with The Pulp and Paper Times, Mr Mihir Shah, Director- Aryan Paper Mills shares his thoughts on several topics, including waste paper crisis, paper prices and new trends in Corrugation. He also discusses Aryan Group's future growth strategy, expansion and potential for new products. Here is the whole interview he gave.
The Pulp and Paper Times | April 2023
Q: Please give us a small introduction of Aryan Group.
We, The Aryan Group, are an established organization in the paper and packaging industry of India known for its integrity, honesty, quality and ethics since 1956. Up till now, our business units have expanded in the recycling of paper with an integrated paper recycling mill, manufacturing of paper board and paper cartons with state-of-art technology and machinery. We are focussing strongly on the environment under leadership of our MD Shri Sunil Shah. Sustainaible growth with a focus on lowering the carbon footprint per ton on paper is our primary driver.
Q: Recently Aryan Group has signed an MOU with Government of Gujarat in the august presence of CM Mr Bhupendrabhai Patel for our upcoming state of the art Paper Mill. Please elaborate on your expansion plan. What is your capacity, Grade of Paper, GSM, BF, Deckle, and investment?
Aryan Paper has been strongly focussed on exports. The new machine has been designed keeping in mind the requirement of corrugators in the international market which work on a very different and evolved buying process for paper. The new machine is a high speed 5.1 m machine which will focus on various grades of paper including FM & TL grades.
Q: Excess Capacity and drop in Exports have made the paper market sluggish. Many new capacities are coming up in Gujarat and south India, which may further impact the market; how do you take this excess capacity issue? And what should be the Indian paper industry's efforts to increase the Export?
Our focus on quality and consistency has helped us establish our paper in more than 25 countries across a network of national as well as international distributors. We have a base of > 75 repeat active international customers which are testament to our dedication to quality.
Q: Aryan Paper made low-cost cardboard beds for Covid-19 patients during the pandemic, any new invention after that please elaborate, Do you think that India has good scope of using corrugated furniture and other household items? In this direction what steps are needed to be taken?
Rhea shah Our Directior who had jsut returned from her Harvard post graduation was the inpsiriing force behind the corrugated beds. She had developed the corrugated beds with her primary focus on reaching out to address issue of huge shortage of beds during the pandemic. The focus was on philantrophy rather than commercial. We had patented the design . Many had copied the same ,but we decided not pursue on our patent rights considering the larger good.
Q: How would you evaluate the waste paper market condition, European Union is planning to ban or partially ban the waste paper export to other countries, and new big capacities are coming up in US, Europe and Southeast Asia which are to consume waste paper majorly. How do you assess all this development as a waste paper buyer?
We have established stong supply chain partnerships with leading waste paper balers in US & Europe . This partnerships have evolved over a relation > 2 decades. These partnerships assure us of steady and consistent supplies over the future.
Q: Sometimes, the Quality of Kraft paper has become a significant hurdle in export; paper mills don’t maintain the quality parameter required by the end user. How do you maintain the quality parameters in Aryan Paper ?
We have visited various corrugators and understood thier working. We are proud to say that one of our customers has been running our paper on a 300 mpm Mitsubishi corrugator on a consistent basis. Our consistency and qulity has been well established and we believe that these 2 parameters are our stengths. We have seen that international buyers have a different mindset and are focuseed more on aspects like uniform web profile , runnablilty ,consistency and SCT based performance. Our team is our strength and our quality is based on our team and our European machinery.
Q: Tissue Paper is the fastest-growing segment in the paper industry, and the Gujarat region doesn’t have much capacity in tissue paper production. How do you evaluate your investment in front of the lucrative tissue paper market?
Our focus continues to be FM / TL and packaging grades for now.
Q: What growth perspective do you predict in Kraft Paper for the next five years?
We believe that the focus in the domestic market to look at value rather over price will evolve. The focus has to change from per kg to per sq meter of corrugated board to enable paper mils and corrugators to offer more value to the customer. We believe that a positive approach and a coordinated partnership by the paper mills and the corrugators to establish common performance standards will definitely help the industry explore its full potential.
Q: Recently, A big Paper Mill – JK Paper has stepped into the corrugation segment investing INR 150 crores for box making with the latest technology. Don’t you think that large investments will trigger consolidation in corrugation industry? How does Aryan Paper review this move, especially when most corrugated box manufacturers are small and medium entrepreneurs?
We are running a 2.4 m Fosber and a 1.7m Isowa line. These lines have given us the edge in terms of technology and perfromance. We will be starting our new corrugating plant within this quarter. The upcoming paper machine has been designed with the help of teams of our key equipment suppliers Bellmer , Valmet & Kadant. Our investments in technology remains focussed as does our extensive learning from the international market.
Q: One of the largest paper-making giant, Asia Pulp and Paper (APP), have received a land allotment letter to set up one of India's most extensive paper manufacturing infrastructure (1.2 million MTA). APP will produce WPP, Tissue and Packaging Grades in India; what is your view on this massive investment? Will the local market of these grades experience a slowdown? How do Indian paper mills compete in these grades?
The per capita paper consumption in India at a little over 13 kg, is way behind the global average of 57 kg. The focus of Make in India and emphasis on an efficient transportation network under the leadership of Honourable PM shri Narendra Modiji makes us confident of growth across multiple segments in the domestic market.
Shree Ajit Pulp & Paper began production at new UNIT-II with the intention of capturing the export market in the light weight segment
Vapi | 19 July 2023 | The Pulp and Paper Times
Shree Ajit Pulp and Paper Limited (SAPPL) is one of the top Kraft Paper manufacturer in India. SAPPL manufactures Premium Grade Kraft Paper – Testliner (single wire) & Multilayer Testliner (triple wire) with GSM range of 80 – 300 & BF range of 20 – 35.
Owing the demand in kraft paper segment, SAPPL has invested in enhancing its production capabilities through the acquisition of NR Agarwal Industries Limited’s UNIT-II in 2022. SAPPL has successfully commenced commercial production at its new unit i.e. Shree Ajit Pulp And Paper Ltd Unit (II) located at Plot No.1, Plot 1/B, 1 st Phase, GIDC, Vapi- 396195, Dist. Valsad, Gujarat w.e.f 17th July, 2023.
“We are pleased to inform you that after having pioneered the Indian Kraft Paper Industry for more than two decades with satisfied channel partners and having enjoyed their patronage & support in catering to domestic as well as global market with consistent quality,” the management said.
“With this, we are venturing in light weights (40 to 120 gsm) with HIGH TENSILE/TEAR performance kraft paper. The quality will meet global standards, which will directly replace imports and also facilitate the export of such grades, a MAKE IN INDIA initiative” its added.
“To sustain in the fiercer competitive market and to enhance the production capacity, after certain modification/ installation/upgradation of the equipment at said Unit-II, the Production capacity of the Unit-II will be 82500 MTS per annum,” said Mr Gautam D. Shah, Chairman & Managing Director- SAPPL in the annual report for fy 21-22.
SAPPL produces 100% recycled products. “We customize our products as per customer’s requirements as customer satisfaction is our ultimate goal. Our quality kraft paper is used by various top MNCs in India & globally to package their valuable goods,” Mr. Shah said.
The future of the Paper industry in general and Multilayer Testliner and Testliner Paper in particular is linked with the future of world economy. When the economy in general is on the down turn, the demand for SAPPL’s products is also likely to fall. On the other hand, when the economy in general is on the up-turn, the demand for the SAPPL’s products is likely to increase. SAPPL is having advantage over most of the other manufacturers as it is professionally managed and its operations are efficient, cost effective and highly competitive.
“We see some exciting new segments where the paper industry can grow at a good pace”: Pawan Agarwal
-150,000 TPA brown-field project: Naini Papers is eyeing flexible packaging segment
- Growth of WPP segment is not going to be as good as it was perhaps before COVID so there would be some sluggish growth
- Overall industry getting benefit and the consumers of India getting benefit from the coming of APP to India
Recently, The Pulp and Paper Times met Mr. Pawan Agarwal, Managing Director, Naini Papers Limited. We discussed various insights into the Indian paper industry, demand growth, digitalisation impact, future demand prospects of Writing and Printing paper, and Naini’s investment in brown field project dominance of packaging paper over publishing paper. Here are Mr Agarwal’s views:
New Delhi | 2023 | The Pulp and Paper Times:
Q: Asia Pulp and Paper is setting up a massive paper making infrastructure in Maharashtra (INDIA). What impact do you see from this new mega capacity of 1.2 million tonnes per annum? Will the market dynamics be under pressure?
I see, there is a lot of space for further production increase in India and since Asia Pulp and Paper (APP) is coming up with a Greenfield project so I would say it's a welcome step and it is going to take the industry forward to the next level. Market is growing, various segments of markets growing with APP coming into India. So I see overall industry getting benefit and the consumers of India getting benefit from the coming of APP to India.
Q: Post COVID, what is the current market paper scenario?
The dynamics of market have changed a lot post COVID and I see a lot of changes coming up. Number one, the traditional way of doing business has totally changed now and we are having more and more online meetings, more frequent online meetings. And as far as product basket is concerned, many mills have changed their product basket. Post COVID, like fine paper’s demand is not as good as it was before COVID and we are seeing that it may decline in coming days for writing, printing paper I'm talking about and also for newsprint. So those mills have found other areas to focus upon and the main area is hygiene products, and single use plastic has been banned but there is no substitute in India today and mills are working on providing the good substitute for single use plastic. So packaging is going to grow significantly in the coming days and many of mills are focusing on environmentally friendly packaging solutions. We see some exciting new segments where the paper industry can grow and grow at a good pace. So I would say next decade is going to be very exciting for Indian paper industry. We can produce not only for Indian market but also for exports.
Q: what appreciation in writing printing paper prices do you see in coming time?
You see this is all market dynamics, I would not like to comment on pricing part because we are linked globally today and there are several phenomena. You see Russia -Ukraine war, it can have an impact, then anything goes wrong with China, it can have an impact. So it is dynamic pricing. So let us not go into that. I can only say that the future of Indian paper industry is good and even if it is writing and printing segment, we are not going to see sharp decline in coming years though growth may not be as good as it was pre COVID, but it's good.
Q: Tell us about Naini Paper’s new brown-field project, which being set up in Uttrakhand? What are the market factors working behind this?
You see again, as I mentioned, the government of India has done away with single use plastic and today the consumers such as big companies who are wrapping their produce into BOPP films and plastic films, they really don't have a viable domestic option available to them. So we see a lot of market potential in this area. So this project basically is eyeing flexible packaging segment. Today, Flexible packaging when you say 99% is plastic film based but there is lot of scope. Companies like Nestle have announced 2025 is a year when they would like to do 100% environmentally friendly packaging. So we are eyeing those big consumers who are looking for sustainable packaging solutions. So this, this machine would be producing substitute for single use plastic and that would be environment friendly.
Q: Please shed some lights on the capacity of the machine and GSM range you are going to manufacture
The tonnage would be close to 150,000 tons per annum and the GSM range is right from 40 GSM to 170 GSM.
Q: What will be the product basket, sir?
It would be as I mentioned, a specialty paper and we will be producing on this machine as per the demand of the consumers, as per the needs of the consumers. So it is going to be challenging. There will be a lot of products, it would be going to the food industry and it would be going to FMCG to replace their BOPP film packaging, flexible packaging and we'll be producing some coated grades as well. But all would be for packaging applications.
Q: Please shed some lights on earlier CAPEX you done in 2018
We invested to streamline our hardwood fiber line and chemical recovery. This is going to be a new investment in the machine.
Q: what is the expected date of start-up of new machine?
It would be commissioned sometime in January 2025.
Q: what future do you see in next two years for the writing printing paper?
You see writing printing paper is going to stay strong. I mean it's not going anywhere and but as I mentioned, the growth is not going to be as good as it was perhaps before COVID so there would be some sluggish growth. The growth numbers may not be as strong but definitely you can expect it to grow by maybe 3 to 4%.
Q: Last year, Government of India has implemented the Paper Import Monitoring System (PIMS) to check on imports. Some of the Paper Trader Association is saying that it is certainly a curb on the import and it is not providing a fair level playing field to traders.
You see, government policies are based on various considerations. I would say, it's not a curb, it's a check. I mean they want the reasonable imports to be allowed, the legitimate imports to be allowed, but not the dumping. So in garb of imports, there were a lot of products that were coming into India which were not through a legitimate channel. It was sort of dumping by those companies. Like their site cuts were being dumped into India at a very, very low price. So this was hurting the Indian paper industry. So government has put his house in order now with implementing this thing. And this is going to be a trial for other products also from the government side. And we are so very happy that government has finally taken this step. And it is not going to hurt even the importers. You see, it was not benefiting anybody and it was just the dumping from those companies into the country. And I think now it would be a fair opportunity for even the domestic players to compete with the overseas counterparts.
Q: International Monetary Fund (IMF) has predicted the that in 2023, there will be a recession around the globe. So what do you think? Any impact on the paper industry?
I failed to understand the logics of economists many a time. And many a times they say something which really doesn't happen even if it is a recession. So recession doesn't mean that demand is going to die. Demand will be there. When they say recession, then we have to really look into the numbers. And it is such a complicated thing. Let us not go into that. Let us keep on responding to whatever comes up for us in the market in the coming days. And I feel recession when you say recession, inflation is going up in Europe and there's a recession in Europe, but demand is there. Demand is not going down. You look at their growth numbers in Europe, none of the countries has reported negative growth so far. So in 2023, it could be tough from liquidity point of view. It could be tough from the availability of funds for various investments. But from demand point of view, I really don't see a challenge in 2023. Thank you.
Nine Dragons Paper reports net loss due to sluggish consumption under the impact of the pandemic containment measures in mainland China
- Current business environment remains uncertain given various headwinds faced by the export business.
China | The Pulp and Paper Times:
In the first half of FY2023, as affected by the sporadic COVID-19 outbreaks and the lockdown measures across China, consumption remained sluggish and the packaging paper industry suffered from low operating rate. In addition, with the impacts of prolonged high fuel cost resulted from the geopolitical war, interest rate hikes and weakening Renminbi, the paper industry was confronted with the most challenging business environment ever.
One of the largest paper manufacturing group worldwide, Nine Dragons Paper (Holdings) Limited has also felt the heat of sluggish consumption under the impact of the pandemic containment measures in mainland China. Both the demand and selling prices of packaging paper saw a marked decline accordingly. Meanwhile, the surging costs of energy and chemicals resulted from ongoing geopolitical conflicts, coupled with adverse factors such as weakening Renminbi and interest rate hikes, have exerted an immense negative impact on the Group’s profit performance.
“In response to the extremely weak market demand, the Group had to suspend production for destocking and offer sales discount for promotion during the Period. The Group reported an unsatisfactory performance on profitability with the soaring power cost, albeit sales remained steady as compared with the corresponding period last year. It was the first time that the Group had registered a loss since its listing in 2006,” said Ms Cheung Yan, Chairlady - Nine Dragons Paper (Holdings) Limited in the interim report for the six month ended on 31 December 2022.
The operating loss for the six months ended on 31 December 2022 was approximately RMB 861.6 million as compared with operating profit of RMB 2,888.3 million in corresponding period last year. The operating loss for the period was mainly due to the decrease in gross profit margin of the Group.
The Group achieved a revenue of approximately RMB 31,198.0 million for the period, representing a decrease of approximately 9.5% as compared with the corresponding period last year. The major contributor of the Group’s revenue was still its packaging paper business, including linerboard, high performance corrugating medium and coated duplex board, which accounted for approximately 89.0% of the revenue, with the remaining revenue of approximately 11.0% generated from its printing and writing paper, high value specialty paper and pulp products.
Ms Yan further describe that Despite the setback in profitability, the Company put in place effective management measures in respect of cash flows and financial risks, and remained its position of “zero” bad or doubtful debts, thereby eliminating the risk of capital chain rupture. Meanwhile, we adopted a series of measures in a bid to break the deadlock and well prepare for market recovery. For instance, by stepping up our efforts to visit our customers, we developed white cardboard and more products that met market needs. We also focused on commencing production of wood pulp and alternative raw materials, implementing multi-pronged “cost reduction and efficiency enhancement” measures and optimizing the management system.
The Group strictly implemented its “cost reduction and efficiency enhancement” measures during the Period. We, on the one hand, adopted a product diversification strategy to develop new products, such as white cardboard, and expand our customer base in response to market changes, while on the other hand, reduced expenses in all aspects and lowered our financial risks by strengthening the management over working capital and cash flows. Despite the Group recorded a relatively stable sales volume during the Period, the sluggish market has impelled us to suspend production for destocking and lower prices to promote sales on multiple occasions. Combined with the high costs of coal and other materials, we recorded a loss during the Period.
The year of 2023 marks a turning point in the COVID-19 pandemic over the past three years. As the Chinese Central Government further optimized the pandemic prevention policies with a series of policies and measures being put in place to stabilize the economic growth, domestic demand and consumption in China are expected to recover gradually, which would enable the packaging paper industry to get back on track. However, the current business environment remains uncertain given various headwinds faced by the export business, such as the unresolved geopolitical crisis, ongoing global interest rate hikes and overseas economic contraction. In the mid-to-long term, market drivers such as opportunities arising from both the trend of replacing plastic with paper in packaging and consumption upgrade as well as the tightened raw material supply will further strengthen the Group’s competitive advantages of integrated pulp and paper production, which will be beneficial to enhancing its market share and broadening its earnings base.
The Group will make every effort to strike a balance between production and sales, and exploit domestic and overseas raw materials and markets, at the same time striving to develop new products to cater to market needs and working aggressively on cost reduction and efficiency enhancement, aiming to realize a turnaround from loss to profit as soon as possible. The Group will leverage the key drivers for long-term growth in profitability while pursuing safe and green production
Opportunities and the future of Indian Paper Industry in the next decade
- Many mills have come up in the Kraft paper segment with capacities of up to 600 to 700 tons per day
- We have to shift to the international system of paper based on fluting and test liner.
- We need to find a way to infuse some long fiber into our paper, maybe by using more virgin pulp or other wood substitutes like straw or Bagass
- Every year, 500 billion plastic cups and 260 billion paper cups with plastic laminate are made, and of the laminated paper cups, less than one percent are recycled.
The Pulp and Paper Times | March 2023
The panel discusses the opportunities and the future of the Indian Paper industry in the next decade at IPPTA’s AGM held at Hyderabad. Panelists share their views and put forward opinions on what challenges the Indian paper industry currently faces and how the industry can solve them using different mediums.
Sharing his views on the growth of the trades and paper industry in the next decade throughout Asia, Mr. Mike Grundy, CEO of Amazon Papyrus Chemicals Private Limited, said, “My perspective is a bit outside of India. As our company operates throughout Asia, I have a view from there. Firstly, we have all heard about Environmental, Social, and Governance (ESG), and our company was not focused on it until about two or three years ago when reality struck. As a chemical company, we had to take it seriously, and found that customers look at our ESG credentials. If they want us to be a supplier, then we have to meet their standards. If anyone thinks that ESG is just a box-ticking exercise, I assure you it is not. Big brands and companies make statements and accounts their sustainability goals in their statements, and share how to achieve those goals. Sometimes there is a cost involved, but most of our actions have given us a return on investment.”
“Moving away from single-use plastic is a huge opportunity for the pulp and paper industry. Currently, around 40% of all packaging is plastic-based, and around 30% is paper- or fiber-based. That will change rapidly in favor of the paper industry, giving an opportunity and challenge to everyone. Every year, 500 billion plastic cups and 260 billion paper cups with plastic laminate are made, and of the laminated paper cups, less than one percent are recycled,” he added.
Answering a question about growth and how to achieve it, Mr. Siddharta Mohanty, Vice President & Unit Head of ITC PSPD Bhadrachalam Unit, said, “When we discuss growth, it has to be profitable. In India, there are two types of growth: one is investment-based, and the other is consumption-based. In India the growth is based on consumption and we need to figure out how to improve consumption. There is no competition because there is no investment-based growth. Before moving ahead with cost competitiveness, the first thing is to prepare a raw material strategy. There are three different types of raw materials: waste paper; the industry has to work out a strategy for waste paper collection because that is the major input cost. Second is wood; the industry needs to work with farmers, which has to be a win-win for both the farmer and society. The third is agricultural residue, which we need to oversee. It is going to impact us, so we have to start monitoring the agricultural terrain and develop strategy accordingly.”
He added, “The second is technology; we have to continuously upgrade the technology to be at par with the quality of international standards. Technology comes with investment, and it is a capital-intensive industry. Third is digital technology; today, artificial intelligence and machine learning (AIML) are largely adopted in different industries to optimize operating parameters and performance. It reduces consumption and increases output.”
Mr. Akshat Agarwal, Director of Vijay Anand Kraft Paper Private Limited, shared his thoughts on how paper mills can adapt to the changing demands and how they can use this as an opportunity to grow their market for finished products. He said, “In the last 2-3 years, many mills have come up in the Kraft paper segment with capacities of up to 600 to 700 tons per day, calling for standardization of the products. Instead of making paper based on BF, we have to shift to the international system of paper based on fluting and test liner, correlating with the board properties. There is a need for standardization of reel widths in Kraft paper. Currently, we sell paper with reel widths with a difference of one centimeter, so that needs to be changed, and a more standard system needs to be followed. It will help the mills improve their efficiency and compete in the international market.”
He added, “Under the Make in India initiative, the companies set up their plants in India, and sell their products overseas. In India, there are concerns regarding foul smell being generated from the Kraft paper mills. The issue arises due to poor ETP designs and the Zero Liquid Discharge (ZLD) permissions that they had from their PCBs. Recently, steps have been taken on how technology can be used to eliminate the bad odor in ZLD plants, and I am sure we will find some solutions.”
“One of the factors to control is the amount of long fiber present in our finished product. Most mills in India are recycled-based, and even the material or recovered fiber imported from the USA and Europe become weak, or the amount of long fiber is reducing due to recycling. We need to find a way to infuse some long fiber into our paper, maybe by using more virgin pulp or other wood substitutes like straw or Bagass, and maybe some technologies, which can improve the tear or act as a substitute for the long fiber, might help,” he added.
He said, “What is amazing is how new markets are opening up, like how micro flutes started gaining importance and are competing with mono cartons. The E and F flutes are finding applications in cosmetics, confectionaries, household chemicals, Etc. So this is because of the excellent printing capabilities. The sector requires a low GSM and a smooth finish, so the white test liners are finding applications. Another application is barrier-coated papers. We have seen a lot of seafood, fruits, and vegetable trays; sugar and flour packaging that is exported, and the contents need to be protected from external moisture, so the barrier-coated paper has a huge potential and demand.”
Mr. Akshay Rathi, Director of Kaygaon Paper Mills Private Limited, shared, “There are immense opportunities for the packaging sector to grow sustainably. In India, the per capita paper consumption is around 15 kg, which is likely to grow to over 30 kg in the next few years, whereas the global average is close to 60 kg. These numbers itself shows the scope for the Indian paper industry. Domestic consumption will help to achieve the growth, and objective of GoI to become a 5 trillion-dollar economy through exports. Currently, India stands at three trillion dollars, we see an opportunity coming our way in the next few years. The global supply chain is getting more integrated, and there are immense opportunities as the manufacturing base shifting to India.”
“As far as exports are concerned, we have seen that packaging paper can be exported. The exports of floating medium and test liner touched over 2 lakh tons per month during pandemic, and it continued for several months. However, the exports could not sustain themselves for various reasons, and issues like bad odor, logistics, run ability, and quality, so if we work on these aspects, there is a huge opportunity for the packaging industry. India exports to the Far East, the Middle East, Latin America, and African countries, these exports that happened were more out of compulsion than out of choice, because China shifted its policy on raw material imports, so for us to sustain these exports, we need to work on quality, and one cannot emphasize enough odor elimination.”
He shared, “For a ton of paper, the recycle-based paper mills consume less than 300 kWh power and less than 2-meter cube water. The segment has achieved these numbers, and it is not easy to digest. There are other areas where a lot can be done to save energy, like installation of rooftop solar plants and using biomass as fuel. Under Swachh Bharat Mission, more emphasis is given on garbage collection and its processing, not only within corporation limits, but also at the gram panchayat level. The processed can be used to convert waste into energy, and I think some government initiatives are promoting and funding local gram panchayats and corporations to collect more waste.”
Mr. Hardik Patel, Director of Sales and Marketing, Om Sree Papertek (P) Limited, shared, “The mid and small-level industries can achieve the targeted sustained growth. However, one of the problems is giving stability to customers. Today, due to the deficiency of fiber, we have waste paper people holding us hostage, and we have to rely on local procurement, which is an unorganized sector. The imported fiber that comes has a lead time of around 60 or 90 days, during which waste paper collectors hold us, hostage, by not supplying or by increasing the prices, and in turn, we fail to provide a sustained and stable market creating uncertainty for the end customer.”
Mr. Madhure Desarda, Director of Operations, Parason Machinery (India) Private Limited, sharing how to achieve growth, said, “I would talk about three categories: How we can have growth in the next decade, how to sustain, and how AIML will play a role in the future. India has more than 600 to 650 paper mills, and the average mill size for small, medium, and large would be around 150, 200, or up to 300 tons a day. Today, India has 60 molded fiber plants; the average size of the plant is 3–4 tons a day, so if you multiply 60 by 4, it is 240 tons per day, whereas, in China, the average plant for molded fiber is 250 tons a day. This molded fiber industry is made for China and India because it is a bit labor- and capital-intensive and we need good fibers, so I believe India has a good future.”
He added, “This industry will be worth around 5 billion dollars in the next one to two years, so I believe this will be a good opportunity for us to enter it, not only on the molded fiber production side, but also on the pulp supply side. Another 50–60 plants are coming into India, so any big mill, whether we go for Bagass pulp, wheat straw, or bamboo pulp, will be a good addition to the industry. Regarding sustainability, we need youth or new people in the industry. Educational institutions should be encouraged to start paper engineering courses. It can start with the elective courses in the last year and with the optional practical training, so there is an infusion of fresh blood in the paper industry, and we can have the right talent.”
Recycled paper is no longer only a product of India or China; export decline, Mills have come up in Turkey, EU, Indonesia, Vietnam, Malaysia
- Major investments in most machines across the world that earlier used to make other grades such as graphic papers.
- Global inflation and high interest rates due to overall uncertainty – we cannot export Kraft for next 4-5 months
- The fibre required for India which is almost 6-7 million Ton Per Annum will become a challenge as quantities will not be available
- Russian and some other mills from Malaysia are supplying kraft paper at almost 20% lower than India market
April 2023 | The Pulp and Paper Times:
The below article is written by Mr Naynesh Pasari, Managing Director of Shree Krishna Paper Mills & Industries Ltd. Shree Krishna Paper Mills & Industries Ltd was incorporated in the year 1974 is one of the leading manufacturers and suppliers of different varieties of Paper in Northern India and our manufacturing facility is situated at : Keshwana, Dist. Jaipur, Rajasthan State. Views are personal in the article.
Recession impact on paper in India and around the world:
During COVID there were sudden ‘MIRCO’ demands from various countries for various products. If you take for example the first phase – the work from home announcement lead to increased demand for electronics , these are products that one must needed under any circumstances. The demand for packaging and shipping these numerous boxes increased. Similarly the micro demands for masks, sanitizers, PP kits and various other covid needs that got a sudden spurt. Work from home or stay indoors also meant sudden increased demand for paper bags, grocery bags etc as the world started ordering items from home. In situations when there is micro demands the disruptions are bound to take place for in terms of prices and overall market economics. The same thing happened in paper – there was dipropionate increase in paper demand over the 18-20 months of covid 1st and 2nd phase which led to increased capacity by paper mills, price rise and major investments in most machines across the world who earlier used to make other grades such as graphic papers.
Now the world is faced with over supply as various machines have been installed in most countries and the impact can be seen across most grades in India too. The global paper market has fallen due to the fact that micro demands don’t last, macro demands do. The impact has been below, reduction in paper consumption by 4% Since past 6-8 months.
Moreover the Chinese recovered pulp prices have fallen between 30 - 50 USD PMT and consumption fallen 2.5% overall YTD.
Present Export scenario of kraft paper and next 3-month scenario:
Exports can take place in cases where domestic demand in the country you are exporting is high due to non-availability of the paper or supply is less than the demand, or price to export is lower than the domestic production. Mills have come up in Turkey, EU, Indonesia, Vietnam, Malaysia and so on. Recycled paper is no longer only a product of India or China now. Mills in most developed countries have installed recycled paper plants and offering Kraft paper at prices Indian mills cannot even match. I recently learnt that Russian and some other mills from Malaysia are supplying kraft paper at almost 20% lower than India market.
Under these circumstances, until we find a solution of the global inflation and high interest rates due to overall uncertainty – we cannot export Kraft for next 4-5 months.
Duplex and kraft manufacturers are increasing prices on account of inputs hike--- impact and market prediction for the next 3 to 6 months.
I feel a 5-6% price increase should take place every quarter, that shows the industry is healthy and there is demand for the product. The Duplex mills who once used to export their paper in large quantity to Turkey, Africa and other markets had to drop their prices by almost 25Rs. /kg or 25-30% which is due to the fact that prices increased also disproportionate. However whatever price increase the mills have now asked for Duplex or Kraft have not been accepted by the market and the industry is back to its sloppy demand since July/ Aug 2022. The important part here is that instead of price rise , the industry needs consistent orders. Once orders come on regular basis the price rise follows.
Waste paper scenario:
China is the most populated country in the world – its per capita paper consumption is 75 kgs. Collection ratio is 45% India is second most populated country but its per capita is only 20 kg. Waste collection ratio is 30% USA is 3rd most populated nation and per capita is 200kg. Waste collection ratio is 65% If you look at the above the interesting part is that India and China whose population are both more than a Billion the paper consumption of India is 1/3 rd of China’s and collection ratio is almost half.
Chinese government have already understood the value of fibre self-sufficiency and hence ensured policies accordingly such as investing in agro fibre and forests. Incase India’s per capita paper consumption increases by even 1% in next 2 years that would mean an additional approximately 2 Million tones of paper is needed in next 2 years. For that the country needs to import an additional MT of waste or produce the same domestically. That is where the real challenge is ahead as China has started using Recycled and agricultural paper pulp. The biggest change in the industry due to which the prices of waste paper has dropped since its peak. Although the prices in the peak was not sustainable and pre covid the prices used to be what it is today for most brown grades. China has also started its agriculture fibre farming and virgin fibre forests. There is a lot of shift there and they are targeting to become fibre self-sufficient country. Moreover they have invested in mills in USA, Malaysia and Vietnam making it easier for them to manufacture paper in those markets and supply to the world instead of importing kraft reels (which they did earlier) and supply finish paper to domestic and export markets. Next 24 months is critical for fibre supply. If domestic mills across the world product in full capacity and china markets open and war ends, the fibre required for India which is almost 6-7 million Ton Per Annum will become a challenge as quantities will not be available.
Imports of kraft and new trends scenario --Demand and price.
As already mentioned mills across the world have started manufacturing recycled kraft or virgin kraft at much lower prices as their capacity is higher. There has been an over emphasis on packaging paper and hence all mills have started producing the same.
Excess capacity in kraft - its impact in long-term and solution
Markets have to become domestic based. The world is moving towards in house demand and supply creation as all economies have realised the only way to sustain a country is to shield itself from global turmoil is to ensure a robust self-sustaining economy. India has been a leader in that and the next few months we need to see the actual policy w.r.t. plastic. There is no clarity as the govt. of some states have tweaked the policy and allowed some plastic making it easier or plastic to again recirculate and paper consumption to reduce. I hope that India’s will lead the world with green revolution and adopting strong policy towards plastic ban. The paper industry’s only hope is packaging and for that focus has to be green plastic free economy.
According to FPTA, increased exports of paper and paperboard caused a "material shortage" domestically that caused prices to soar, wrong propaganda by IPMA on print & social media
- Misleading Information and Wrong Propaganda by Indian Paper Manufacture Association (IPMA) on various Print and Social Media's across India
- The Indian Paper Manufacturers have exported a huge Quantity in multifold of various products led to a shortage of material in domestic market.
Mumbai | 3rd June 2023 | The Pulp and Paper Times:
Federation of Paper Traders' Associations of India (FPTA) is a Federation of 37 Associations across India and comprising of more than 6000 + Paper Traders situated across India, has claimed that misleading information and wrong propaganda on various Print and Social Media's across India spread by Indian Paper Manufacture Association (IPMA) in last few weeks on Surge in Paper Imports.
In its representation to Directorate General of Foreign Trade, FPTA says that we would like to state for IPMA's Wrong Propaganda / Misleading Information to Government of India and General Public at large. IPMA has gone to the extent of changing the parameters to suit their logic, from quantity to value. Surprisingly prior to this IPMA never spoke in terms of value.
According to the latest data issued by the Directorate General of Commercial Intelligence & Statistics (DGCI&S) in May, Indian imports of paper and paperboard have jumped 47%, from INR 7,839 crores in FY 2021-22 to INR 11,513 crores in FY 2022-23. Indian Paper Manufacturers Association (IPMA) stated in its release that imports of paper and paperboard into India have significantly increased in the last three years, in spite of adequate domestic production capacity.
On the other side, FPTA stated that The Statistics for the imports as compared by IPMA for the year 2021 - 22 and surge in 2022 - 23 are partially correct and project a different story altogether. The imports are compared to Corona Times to the last financial year. The data must be compared to the Precovid times to the present when normal times.
According to the table below, Import of paper and paperboard have come down to 1,752 thousand tonnes in FY 21-22 as compared to 2991 thousand tonnes in FY 19-20 ( precovid), which decreased by 41 per cent in two years. The exports of paper and paperboard have increased to 2857 thousand tonnes in FY 21-22 as compared to 1662 thousand tonnes in FY 19-20.
IPMA stated that due to surging imports, most small and medium paper mills in India are commercially unviable, jeopardising the livelihoods of thousands of farmers engaged in agro / farm forestry and supplying wood, the primary raw material, to paper mills.
“The story is different from what they are propagating as per the Graph or Data by DGCI&S. The Indian Paper Manufacturers have exported a huge Quantity in multifold of various products. The above chart clearly shows that exports in FY 2020 -21 and 21-22 were to the tune of 2,194 and 2,857 thousand tonnes as compared to imports of 1,747 and 1,752 thousand tonnes. Due to material exports in the Last Financial Year, there was a shortage of material and the rates per tonne were skyrocketed more than double in just a year from 2021 - 22 to 2022 -23 and availability was an issue which hampered the Businesses of various Indian industries of Make in India project.” FPTA said.
FPTA also stated the breakup of imports and exports for FY 2O21-22 quality-wise. The net figure for imports of paper and paperboards is only 1,146 thousand tonnes as 606 thousand tonnes is newsprint which is regulated by separate norms of the Government of India and do not form part of the open trade.
The representation states that It should also be noted that as per the statistics of Ministry of Commerce & Industry, Government of India, and shared by Indian Pulp & Paper Technical Association (IPPTA) the exports of paper and paperboard in the FY 21-22 were to the tune of 3.53 million tonnes as against imports of 2.18 million tonnes. The Department of Promotion of Industry & Internal Trade (DPIIT) annual reports for 2Q22-2023 also publishes the above numbers and thereby provides authenticity to the data.
“However, in FY 2022-23 the exports of paper and paper including newsprint were to the tune of 2.46 million tonnes as against imports of paper and paperboard including newsprint to the tune of 2.52 million tonnes. Imports of newsprint being 0.62 million tonnes the net figure of imports for paper and paperboards comes to 1.90 million tonnes, much below the exports of 2.46 million tonnes. One needs to compare apples with apples only and not oranges.” FPTA says.
ln 2O21-22 there was restrictions of imported Copier Paper due lo BIS certifications was mandatory for the Suppliers of imported Copier. As we have short supplies of Copier Paper in India to the required demands. BIS registrations were completed by Foreign Suppliers in 2022-23 so there was marginal increase of imports to 2021-22.
Some Other Facts of IPMA as under to consider:
-IPMA represents only 15 manufacturers as against a total of 900 out of which 553 are operational, a mere 1 .66 per cent. (DPIIT Annual Report 2022-23 for FY 21-22).
- IPMA members have an installed capacity of 4.826 million tonnes as against the total installed capacity of 30.73 million tonnes (DPIIT Annual Report 2022-23 for FY 21-22) having a share of only 15.704 per cent
-IPMA members domestic sales are to the tune of 3-710 million tonnes as against the production ol 22.50 million tonnes (DPIIT Annual Report 2022-23 tor FY 21-22), having a share of 16.488 per cent.
-IPMA had a capacity utilization rate of 89.55 per cent as against the industry's 87 per cent. (DPIIT Annual Report 2022-23 for FY 21-22)
FPTA stated that IPMA has projected a shortfall of 2 million tonnes of pulpable wood even after more than eight decades of presence of the domestic industry. IPMA also projects a Recovery Rate of a mere 38 per cent as against 68 per cent in United States and more than 70 per cent in Europe. These facts itself proves the lack of initiative towards improving the recovery rate and growing wood to make the country "AtmaNirbhar. lf at all the domestic players were to have taken even a small towards the above the Government of India would not have to spare precious foreign exchange of 2,06,920 million rupees on imports of pulp and wastepaper to the tune of 7.81 million tonnes in FY 2022-23. (Source of this data in Ministry of Commerce & Industry as circulated by IPPTA).
Kraft Paper Mills: matter of survival due to ongoing recession; plants are for ‘Sale’ in Morbi; PM operating at reduced production
- If the price falls to Rs 23 per kilogramme, there is a prospect of export
- Paper mills should consider diverting their capacities into other products such as kappa, tissue board, and recycled writing and printing paper
- Paper mills held orders for 10 days, but this has now dropped to 3 days
Vapi | Morbi| Mehsana | 12 May 2023| The Pulp and Paper Times:
For paper mills in India, the overcapacity in manufacturing lower BF kraft paper has turned into a sore point. To be competitive, paper mills are offering their product at breakeven. The paper industry is suffering from a sharp decline in demand. Paper mills are frequently temporarily or permanently stopping production.
Mr Sunil Agarwal, President of Gujarat Paper Mills Associations (GPMA), told The Pulp and Paper Times that although domestic demand for kraft paper has not decreased, we are 25% overproducing and therefore experiencing a major demand issue.
Mr Abhishek Agarwal, Director of Resonance Paper Mills, located in Morbi, stated that paper mills in Gujarat are in very poor condition, with demand driving paper mills to operate at roughly 50% capacity.
"There is no demand from the overseas market, China is closed, and we see no positive indication of demand revival in the near future," Mr Abhishek explained.
“Around 20 paper mills have been declared for sale in Morbi. Those have bank loan have decided to scrap the paper mills to repay the loan, few paper mills have taken temporary shutdown for 6 to 8 months waiting for improving market condition,” Mr Sunil Agarwal stated.
Mr Manoj Patel, director, Sukraft Group, blames overproduction of kraft paper as the primary cause of decreased demand, claiming that the paper sector saw a large amount of new production capacity constructed without any calculation in the kraft segment. "New paper mills will struggle to survive if organic demand growth does not materialise or exports resume at a higher scale." He added.
“The recycled paper industry is in severe crisis. It is now a matter of survival due to ongoing recession in domestic and international markets” Mr Sunil Agarwal, President, GPMA informed.
Mr Dixit Patel, Director of DN Paper Mills, confirms that paper plants in Gujarat are running at lower capacity. Many paper mills in Morbi have temporarily closed, while paper mills in Surat, Vapi, and Mehsana are also under strain from low demand and are compelled to work at 50 to 80% capacity. "5 to 7 plants in Morbi are on sale due to a demand crisis," he continued.
“We are running all six factories at full capacity; obviously, there is a problem with steady local demand, but because we are close to a port, we compensate for our paper production through export.” Mr Manoj Patel stated.
There is huge demand drop in lower BF such as 16, 18, 20 because most of capacity fall under this range, around 4,00,000 tonnes paper manufactured in lower BF only in Gujarat and Maharashtra.
Mr Abhishek Agarwal also blames excess capacity as the primary cause of the decline in demand. There has been no shutdown in the packaging business such as in the FMCG and electronic sectors, but a rise in paper supply has affected many paper factories. Today, buyers/corrugators have numerous options for purchasing paper which force a paper mill to compromise in pricing. He stated that in Morbi, there were perhaps 15 to 20 paper mills, which had increased to 60 to 65 in just a few years.
On the issue of a paper mill's survival, Mr Manoj Patel advises that massive new capacities in South East Asia could put a crimp in the export market for Indian paper mills, so paper mills should, or should I say must, consider diverting their capacities into other products such as kappa, tissue board, and recycled writing and printing paper. Mr Patel is optimistic about the Diwali festival's recovery of demand.
DN Paper Mills, which manufactures higher GSM paper, is operating at full capacity. "We have some export orders as well, but the decline in local demand is affecting us," Mr. Dixit noted. Mr Dixit looks optimistic to have a revival in demand from Diwali.
"Paper Industry in Morbi is facing significant challenges. The question is of existence for most paper mills in northern Gujrat . It will be a big blow to the multiple employment opportunities provided by his MSME sector. To balance the demand and supply equation, paper mills in Morbi may shut down the plant operations," Mr Dixit explained.
Mr Abhishek Agarwal added that many paper mills are closed, and if demand does not increase, paper owners will have to sell their equipment or permanently down it. If this situation persists, we will see a balancing of supply in the next three to four years.
"Export market is expected to decline because of the Chinese paper mills giant's establishment of new huge capacities in Vietnam, Indonesia, and Malaysia. Indian paper exports were totally dependent on the china market when China's Government imposed a ban on waste paper and strict norms to save the environment two years back. Now China's paper mills have overcome this hurdle by strengthening their supply chain." Mr Agarwal stated.
Mr. Abhishek Agarwal claims that a paper mill makes a profit when it operates at 100% capacity, and that the current circumstances may compel them to sell the factory if the demand crisis persists.
Mr Nailesh Patel, Director of recently formed paper mill Himalay Paptech Pvt Ltd. in Mehsana, stated, "We are operating our mill at 100% capacity but not receiving the price of our choice, there has been lot of variation in rates." The price of 18 BF paper today (9 May) is 25.50 per kg.
On the demand front, Mr Nailesh acknowledges that order frequency has declined dramatically; before, paper mills held orders for 10 days, but this has now dropped to 3 days. Furthermore, in the event that the price of finished paper falls further, corrugators and converters are not putting large orders in contrast to their previous orders.
Local demand can only be revitalised if the export market improves. "The export market is completely driven by the local price of finished paper, which is now hovering around Rs 25 to 26 per kg," Mr Nailesh remarked. If the price falls to Rs 23 per kilogramme, there is a prospect of export. When the local price plummeted to Rs. 24 per kg two months ago, a few Morbi’s paper mills received orders from outside.
FCBM: India is handicapped by lack of High-quality high strength Paper for non-packaging use
-FCBM: With evolution of very large players only a few niche players will survive
-Conditions are very dynamic these days with continuous evolution of business scenarios
The Federation of Corrugated Box Manufacturers (FCBM) of India is a leading & vibrant association representing all Corrugated Box Manufacturers. Over Last 50 years FCBM has rendered yeoman’s service for betterment of its members and promotion of Corrugated Box usage & corrugation industry.
Recently, The Pulp and Paper Times got the opportunity to have an exclusive interview of FCBM’s new president Mr. Vineet Jain, over various issues related to recession, raw material crisis and massive investment into corrugation industry by large corporate players. Here is his full interview:
Q: What is FCBM’s quick review for the present state of the market? demand is sluggish and price for raw material (Kraft Paper) has dropped down, is this a beneficial situation for corrugators?
FCBM monitors & updates its members in evolving business scenario on a continuous basis. There are constant changes in the demand & supply of Boxes, Kraft Paper & downstream items. Awareness of market forces in play is a vital component for making informed business decision for growing. With market forces working at many facets, it is difficult to predict which particular one is good or bad. Also the conditions are very dynamic these days with continuous evolution of business scenarios.
Q: Paper mills and the corrugators organization have been playing the victim card since the COVID pandemic regarding the kraft paper price hike that was artificial, the skyrocketing cost of wastepaper, logistical difficulties, etc. How does FCBM rate this situation?
The Fact that paper segment of the supply chain is very well organised and works for betterment of its fraternity has been recognised even by Competition Commission of India. Most of their decisions not based on pure commercial developments. Yes, due to Covid not just paper, all commodities prices skyrocketed but have cooled down to pre Covid levels. However, the Ukraine war has pushed fuel costs to unreasonable levels. Now the Covid alarm in China is creating another negative wave in Global business scene.
Q: what initiatives does FCMB think should be adopted in order to make paper mills and corrugators' relationships more healthy and trustful?
FCBM has been striving continuously for long to create new bridges with not only their customers but also suppliers. FCBM is willing to take two steps forward for every step taken by paper mills for a healthy and congenial business atmosphere thus creating a win-win situation.
Q: The associations related to paper and corrugations are seeking the Government's intervention in the raw material crisis. Do you think the Government can really regulate the prices and excessive export of Kraft paper in the open market dynamics?
The Government Cannot and will not get involved in price regulation unless situation is alarming. But there is little they can do to make prices move in one direction.
Q: Recently, A big Paper Mill – JK Paper has stepped into the corrugation segment investing INR 150 crores for box making with the latest technology. Don’t you think that large investments will trigger consolidation in corrugation industry? How does FCBM review this move, especially when most corrugated box manufacturers are small and medium entrepreneurs?
Consolidation is now a reality and here to stay. It has happened all over the world across all products and corrugation industry in India must be prepared for this ultimate fact. With evolution of very large players only a few niche players will survive, and rest will be victim of attrition as has happened elsewhere.
Q: What is the current growth rate of the corrugation industry in India, and how will it take shape in the next five years?
Growth of any industry depends on:
1. Growth in GDP.
2. Rise in income of & consequent living standards of public at large. These determine growth in consumerism.
3. Balance of exports and imports.
Fortunately for India most parameter determining growth of industry are very positive and medium-term projections do look very good. Till now Imports of finished goods led to subdued manufacturing in India but now with make in India policy of India, glaring gap between imports & exports will shrink. Auguring well for demand for corrugated boxes. In view of these the Corrugation industry should have growth at 10%+ PA.
Q: There has been a prediction of a recession in 2023, which may cause a reduction in packaging demand; already in Europe, paper mills are shutdown due to the energy crisis, and waste paper will start going to landfills. India is also facing high inflation. How does FCBM is drawing its strategy for the members in order to curb recession impact?
There could be a possibility of some waste going to land fill if the prices do drop more. But that does not look imminent as Energy cost in EU has dropped down to pre-war levels. There is strong likely hood that west will go through a period of almost 0 growth but to early to raise alarm bells. There is huge addition to paper capacity in India & SSE Asia which will increase demand for fibre ensuring some stability in prices.
Q: Increasing demands of Kraft Paper suppliers to specify RCT ( Ring Crush Test) instead of BF & adhere to it consistently. Box manufacturers have started differentiating mills based on consistent quality. How would FCBM evaluate the Kraft paper quality of the Indian Paper Mills on various parameters?
There is a very old adage that mother feeds a child only when it cries. At association level FCBM has been raising issues of quality & standardization of paper supplies for over 30 years. There has been considerable improvement in some parameters with a lot still to be achieved. Mills particularly the newer larger ones with better process control must come forward to engage with their customers on these issues as such improvement is beneficial to all.
Q: European Union policies place a strong emphasis on the role of packaging in the circular economy and its design to be recycled and/or reused, whereas, In India, there is no much emphasis on the circular economy of packaging. Do you think that any Legislative proposals may ensure that any packaging placed on the Indian market should go for recycling?
It is not right to compare EU conditions with India.
1. There is huge variation in degree of problem. Consumerism in EU has reached a very level with many practices such as portion packs leading to humongous generation of packaging waste. One can surmise EU is a waste generating society.
2. India is still very largely family units having different requirements of purchase, very low degree of packaging penetration, etc. Slowly India too is moving towards EU habits leading to more packaging waste.
3. However, being a late starter has its advantage. India has become aware of the harm packaging waste can cause and has started regulating use.
4. Many technologies to recycle / upcycle waste is rising on horizon daily. Many compostable packaging materials as a replacement / substitution are becoming economically available now.
5. Also, still affordable labour costs make recycling in India more economical proposition.
Q: The construction of many items utilised in day-to-day living, including as furniture, homes, workplaces, hospitals, and other locations, is another creative endeavor of the corrugation industry. India is lagging behind in the use of products constructed of corrugated material. How does FCBM want to encourage "corrugation formation" in Indian society, which might create a significant new source of income for corrugators as well?
Non-Packaging use of Corrugated is evolving opportunity globally. India is handicapped by lack of High-quality high strength Paper normally required for such applications. This in turn is caused by lack of locally available good quality fiber. Rising consumerism & social media will ensure these areas too will soon catch up with global level.
Q: Research & Development is a core exercise to develop a value-added product for the end-consumers securing product margin. How do you evaluate the R & D activity being conducted by FCBM member companies? If we see the last decade of corrugation operations, what major R & D outputs have been delivered to the end consumer market?
R&D in Packaging more a top-down syndrome in India with consumers pushing same. Still withing limited means Indian corrugation industry has risen to demands of consumers with new developments & ideas. With increasing sizes of corrugation companies impetus to R&D will gain.
Kraft Paper Mills shut down operations in North India due to a lack of demand
Delhi | Ghaziabad| Shamli| Uttarakhand | 2 May 2023 | The Pulp and Paper Times:
Paper Mills in north India have stopped production for a week due to declining demand for kraft paper. Paper mills in western Uttar Pradesh and Uttarakhand have closed due to low demand induced by the global recession and rising inflation.
Mr Ashok Bansal, Managing Director, Nikita Papers Limited, told The Pulp and Paper Times, "Yes, we have closed down our production activities from the 29th of April to the 4th of May due to sloppy demand." In addition to Western Uttar Pradesh, paper mills in Uttarakhand, Punjab, Haryana, and Rajasthan will close. The global crisis and increasing inflation had a significant impact on kraft paper consumption."
On the Shutdown by paper Mills, Mr Naresh Singhal, President of The Indian Recovered Paper Traders Association (IRPTA) said that this entire situation arose due to the fact that Kraft paper mills were continuously working only at a difference of Rs 8000/to Rs 9000/ pmt as conversion charges since long. In simple words difference between waste paper prices and finish paper prices was Rs 8/to Rs 9/ per kg,
At the time when Kraft paper mills decided to take shut down the rate of Kraft waste paper was Rs 17000/+ pmt and finished Kraft paper 18+ B.F 100 gsm was Rs 25000/ pmt ex mill which is not viable to continue long” explained by him.
Mr Prajwal Agarwal Director, Gangotri Paper Mills situated at Uttrakhand, said, “There is a shortage in demand globally, inflation is on the higher side, import orders are decreased and even corrugators are not using full capacities. We hope that demand should pick up in next two-three months and this shutdown will correct the market.”
“Recycled paper is no longer only a product of India or China now. Mills in most developed countries have installed recycled paper plants and offering Kraft paper at prices Indian mills cannot even match. I recently learnt that Russian and some other mills from Malaysia are supplying kraft paper at almost 20% lower than India market,” said Mr Naynesh Pasari, Managing Director of Shree Krishna Paper Mills & Industries.
Mr Amrish Singhal, CMD of Muzaffarnagar-based Silvertoan Papers Limited, told The Pulp and Paper Times that in the previous three years, kraft paper production capacity has expanded by about 40% in proportion to demand, which has climbed by barely 18 to 20%. Paper mill owners agreed to shut down paper their operation five days per month until the demand-supply equation was balanced.
"Paper mills have suffered significant losses, and the shutdown has spread to Uttarakhand, Punjab, Haryana, Uttar Pradesh, and a few areas of Rajasthan." To recover the demand situation, we must adopt the pattern of South and Western India paper mills, which observe forced shutdowns every month." Amrish stated.
Talking about the absorbent kraft paper demand, Mr. Vijay Mittal, Director Nachiketa Papers based in Punjab, says, “We are weaving through a very tough time; there is very crushed demand in the laminated industry; thus, we have. We are also taking a shutdown to balanced out our stock.”
Mr. Ashok Bansal further stated that corrugators had received 20% fewer orders than in previous years. In the month of May, we have seasonal demand for Apple and spirits packaging (Wine and Beer). We received a high demand from Himachal Pradesh for the packing of apples in boxes, but owing to a delay in determining the size of the box, corrugators have not made orders; we aim to fix the issue by mid-May.
On declining Export demand, Mr Naynesh Pasari, exclusively discloses that exports can take place in cases where domestic demand in the country you are exporting is high due to non-availability of the paper or supply is less than the demand, or price to export is lower than the domestic production. Mills have come up in Turkey, EU, Indonesia, Vietnam, Malaysia and so on.
“As far as exports are concerned, we have seen that packaging paper can be exported. The exports of floating medium and test liner touched over 2 lakh tons per month during pandemic, and it continued for several months. However, the exports could not sustain themselves for various reasons, and issues like bad odor, logistics, run ability, and quality, so if we work on these aspects, there is a huge opportunity for the packaging industry. India exports to the Far East, the Middle East, Latin America, and African countries, these exports that happened were more out of compulsion than out of choice, because China shifted its policy on raw material imports, so for us to sustain these exports, we need to work on quality, and one cannot emphasize enough odor elimination.” Explained by Mr. Akshay Rathi, Director of Kaygaon Paper Mills during IPPTA AGM in March.
Mr. Akshat Agarwal, Director of Vijay Anand Kraft Paper Private Limited, shared his thoughts in IPPTA AGM, on how paper mills can adapt to the changing demands and how they can use this as an opportunity to grow their market for finished products. He said, “In the last 2-3 years, many mills have come up in the Kraft paper segment with capacities of up to 600 to 700 tons per day, calling for standardization of the products. Instead of making paper based on BF, we have to shift to the international system of paper based on fluting and test liner, correlating with the board properties. There is a need for standardization of reel widths in Kraft paper.
Sloppy Demand for Kraft and Duplex, No chance to export; nonetheless, quality and branding can prevent a 'shutdown'
On the sluggish market and sloppy demand for Kraft and Duplex, Mr Naresh Singhal, president of The Indian Recovered Paper Traders Association (IRPTA) shared his views about the market sentiments, future anticipation and decreasing demand for the waste paper. And shared some insights over how paper mills tackle this situation.
- Price correction possible in 2 months for waste paper
- Morbi Paper Mills Association has voted to raise the price of finished paper by Re 2 per kg
- If the demand arises, and the rate has already fallen a lot, then the extra waste paper is going in the stock
- Paper mills will have to do price corrections to increase the demand in the market
- Availability of cheaper products from paper mills in Indonesia, Taiwan, and Malaysia. And the cost of Indian products is on the higher side.
- Mills are shutting down, as they have loans and EMIs. The fixed expenses, such as electricity charges, salaries of permanent staff, and maintenance charges, keep on piling
New Delhi | 17th April 2023 | The Pulp and Paper Times:
“Currently, the waste paper has hit rock bottom. The losses incurred till now, from January to April were being suffered by the packaging segment, especially Kraft. The prices were reduced from Rs 21-22 to Rs 17. The loss that is happening now is to the duplex mills, which use white-grade material, as the rates of the waste paper are reduced by Rs 5-8. Well, in the last one and a half to two months, I talked about something, whether it is the record, sorted, HBR, super record, and notebooks, there is an average difference of Rs 5-7, and that too in the last ten days, be it Punjab, UP, Uttarakhand or Kolkata. The prices of LWC and HWC paper are stable. The last correction to their prices was around 2 months ago. The rates of Duplex paper may reduce now. The Duplex mill owners have unity between them, so they discuss and reduce the production, to tackle the market situation accordingly." Mr Naresh Singhal said exclusively to The Pulp and Paper Times.
On current prices of waste paper for Kraft, he added, “The prices are stable for waste paper for Kraft paper in North Indian cities like Meerut, Muzaffarnagar, Uttarakhand, and Punjab, here it costs around Rs 17-17.50. The Kraft waste paper has reduced a lot in South Indian cities, like Bangalore, Karnataka, Hyderabad, Chennai, and other surrounding areas, the rates are around Rs 14.5-15. In central India, the price range is between Rs 15-16 in cities like Nagpur, Indore, Ahmednagar, and Pune."
He said, "There will be a correction in the next month. The waste paper prices may get correction by around 50 paise to Re 1 per kilo after May 15. Currently, the rates of white-grade waste paper reduced by 5-6 rupees per kilo, it has gone down to Rs 28 from Rs 34-36. For example, the Recycling mills or Duplex mills, use white material, if someone wants to take a sentence, they use a sorted book, record, HBR, or super record, its price reduction of about Rs 6-8 in the last 10-15 days.”
However, the Morbi Paper Mills Association has voted to raise the price of finished paper by Re 2 per kg beginning Monday in order to boost market sentiments. The market has yet to absorb the price. Some paper mills in Gujarat have been closed due to low demand, and others are on the verge of being sold if demand does not increase.
Speaking on the near future scenario and demand for finished paper in the next 2-3 months, Mr. Singhal added, "At the moment, the cost of the Kraft is almost stable. In the immediate scenario, Eid is on April 22; this means the waste paper collection in the market will be less between April 21 to April 26, because a lot of Muslim community people collect waste paper. And if you leave the holidays at the end of April, then after May 10, the heat in the market will increase. Because of the temperature rise, the vendors who roam from street to street will have trouble with the collection, and the collection will be low till the end of June. If, because of shortage, the demand for paper is increased, then there will be a correction of prices by 50 paise up to Rs 2."
On the export front, he said, "There is no chance in near future for export of Kraft paper, because of inflation, increased interest rates, and the main reason is the availability of cheaper products from paper mills in Indonesia, Taiwan, and Malaysia. And the cost of Indian products is on the higher side. The first 2 months of the next six will be bad, as there is no demand in the market. The demand would rise after July-August."
On low export demand and excess production capacity, resulting in the shutting down of some mills in India, he said, "Mills are shutting down, as they have loans and EMIs. The fixed expenses, such as electricity charges, salaries of permanent staff, and maintenance charges, keep on piling. Gujarat has a huge number of such mills in Morbi, Vapi, Ahmedabad, etc."
On what strategy these mills should adopt to reduce the loss, Mr. Singhal added, "They need to promote sales and focus on quality and branding, because in this tough time both the factor are the savior for a paper mill up to some extent. There is no or less demand for the finished paper, and to enhance the demand, price correction is needed. The Kraft paper mills run proportionally with the waste paper. If the price of waste paper is reduced, so is the production of finished paper, or if the prices increase, they increase the production. The margin is less, and so is the conversion cost for Kraft paper mills. While other mills, such as Duplex mills, writing printing mills, or newsprint mills, do not change prices according to the waste paper prices. So the paper mills will have to do price corrections to increase the demand in the market. Secondly, because of the continuously falling rates, there is a lack of interest in stockists to stock paper at any level. Today, no dealer wants to keep a large stock of finished paper and only stock for day-to-day demand."
On sharing his views on the converter or end user manipulating the market price and demand, he added, "No. The end users do not look at the price when they need the material. They do not manipulate the price because they do not want to keep stock. Earlier, the end user or converter used to stock material for thirty days according to the needs of his party. I believe if I stock for 15-20 days, then I would not be affected by the ups and downs of the market. Now people fear losses due to stocking, so they stock for 3-7 days only."
Speaking about mills that produce Copier paper, writing printing using wood, and Agro-based pulp, he said, "At present, they are in a strong position, but as soon as their demand is over, the price will come down from July onwards. It is the season for those paper mills that are producing Agro-based white paper, or pulp-grade white paper. From July 15 onwards, their demand will reduce, and after that, prices can reduce. When the price of pulp-grade paper will reduce, then in support, the price will also reduce accordingly in the Agro-based unit or the recycled paper mills. The prices of recycled paper mills depend on wastepaper prices, and there is a possibility that it may not change till October-November. The market may get after September or October or may improve a little next month. Temporarily, the first improvement will be of 50 paise to Rs 2, then heat and temperature would affect the waste paper collection in May, so limited supply will automatically increase in price."
Comparing domestic waste paper with imported waste paper, he added, "The domestic waste paper is cheaper by Rs 1-1.5 per kilo than the imported Kraft waste paper, such as OCC. Even one can get domestic waste paper on credit. Assuming that you import waste paper, pay to retrieve the documents, on the other hand, you can pay the supplier after one month or two months for domestic waste paper. Domestic waste paper is cheaper than imported, so to overcome this gap, either the price of domestic will increase or the price of imported waste paper will decrease. Today, for instance, if the imported kraft grade or white grade waste paper costs Rs 20, then the domestic waste would range around Rs 17. Similarly, if a lot of imported waste paper is Rs 35-36, then domestic would cost around Rs 32. The point is the price of imported waste paper is much more expensive than that of Indian waste paper when it reaches the factory, so either the price of domestic will increase or the price of imported waste paper will decrease."
Sharing his views on stocking waste paper, he added, “If the demand arises, and the rate has already fallen a lot, then the extra waste paper is going in the stock. Either the waste collector or the paper mill is stocking the same. So whoever stocks will get the benefit because the market will have to get back again, the Rs 5-6 that fell in the one and a half months will have to reach the same point again. When it comes back, then this stock will get a profit. The rate of waste paper has fallen, sales are decreasing, and the market is under control, so the extra waste paper is going into the stock. The waste paper has reduced, and the same was the target of the paper mills to get less waste paper. So now that the new fresh stock of waste paper is coming, it is being stocked at different levels: some vendors are stocking, and some paper mills are also stocking. The demand is low at different levels, so I cannot say how much the difference is. However, the average price of domestic waste paper is 10 to 20% cheaper than imported ones. This market is floating at 10 to 15% lower price, and it will improve."
Speaking on the loss of fibre from recycling, Mr. Naresh Singhal said, "Every time a waste paper is recycled, approximately 17-20% of the fibre is lost, and there is an annual growth of 5-6%, which means we have to add 22-23% of new fibre in the industry. The shortage in waste paper is because of this loss of fibre. If you ask any technical person about the yield while recycling the waste paper, he would say that they would get 80-82% yield on the disintegration of 100 kg waste paper if there is no Ash, soil, and no bad material present in the waste."
Pudumjee Paper: Continuous strengthening of in-house R&D setup, products innovation and enhancing value addition
Pune | December 2022 | The Pulp and Paper Times:
Pioneering in Specialty Paper business in India, Pudumjee Paper Products Limited (PPPL) has stood by its core belief and commitment to the customers. Registering a remarkable turnover during the FY 2021-22, PPPL will continue to strengthening of its in-house R&D setup, products innovation and enhancing value addition, PPPL intends to build stronger ties with the users and prospective customers along with standardizing products specification and continuous upgradation of product portfolio to have more and more value-added products.
PPPL has achieved a turnover of INR 555.26 crores against INR 436.88 crores in the previous year with EBIDTA of INR 75.76 crores as against INR 76.02 crores in the previous year. Net Profit Before Tax (after exceptional item) of INR 46.00 Crores (Previous year INR 34.70 Crores). Cost of certain inputs of energy, chemicals, fibres and others have, on an average, increased by about 25% compared to the previous year, which the Company could substantially mitigate by way of change in product mix, improved operating efficiency as also price rise of its products and inventory gains. This performance would also need to be appreciated against the back drop of huge challenges posed by intense Covid second wave at Pune and Mumbai where Company’s manufacturing facilities and corporate office respectively are located. It was dedicated efforts of the employees, dealers and customers throughout the country which contributed towards this better performance.
PPPL manufactures Specialty Papers for various purposes and application such as for packaging of food products, industrial applications and applications required in oil and grease resistance. The Company’s products are sold throughout the country directly to customers as also through a network of dealers with some exports to nearby countries and Europe.
PPPL sources its Fibre requirements primarily through imports of market pulp and waste paper. The prices of these fibres were on upward trend. The market pulp prices of various grades on an average ranged from INR 50,150 per MT to INR 84,100 Per MT as against INR 33,700 per MT to INR 75,250 per MT in the previous year. The waste paper prices of various grades on an average ranged from INR 23,000 Per MT to INR 44,850 per MT as against INR 14,750 Per MT to INR 29,600 per MT in the previous year. Certain important chemicals and coal prices have also witnessed unusually high prices, as stated in annual report for FY 21-22.
As per the PPPL’s annual report, the prices of coal used by the Company has also seen an unparallel rise which moved from INR 6,880 per tonne to INR 16,250 per tonne towards March 2022. PPPL while determining its prices also attempts to pass on input cost escalation to customers, after adopting means of conservation of energy, where and to whatever extent feasible.
Pudumjee Paper, where feasible, adopted cost reduction measures, reworked its product mix and temporarily discontinued or lowered production of certain varieties of products such as Crepe Tissue for Hygiene application. The Company also added certain more specialties in Food Grade papers, Print Base papers, Flexible Packaging papers, etc., to its products portfolio.
As per the annual report, PPPL’s Paper production is currently continuing at about 70% of its capacity of 72,000 MT per annum.
The Hygiene Products Division, which primarily caters to Institutional customers also achieved higher turnover by about 24% over the previous year inspite of continuing impact of “Work From Home” (WFH) environment and closure or partial functioning of Corporate Offices, Hotels, Restaurants, etc. The lower Institutional Business compared to pre-Covid years has resulted in impairment of goodwill attributable to business of the Division.
Hygiene Products Division of the PPPL mainly markets its Away-from-Home Hygiene products such as Bathroom roll, Kitchen Towel, Napkins, Dispensers, Sanitizer, Disinfectants, Hand wash Soap, etc., under brand name ‘Greenlime’ to Institutional customers comprising Corporate Offices, Facility Managers, Business Hotels, Airports etc.
PPPL has installed an offline coater to focus on functionally coated papers for food packaging industry with special emphasis on quick delivery system of food.
Global demand for graphic papers is expected to decline by 2 million tons in the next 3-4 years : AFRY
- Non-wood pulps in papermaking is expected to remain only marginal in the future
- The solution to the digitalisation dilemma demands not only an expertise of application solutions but, more importantly, a sound understanding of industry technologies and processes
- Retrofitting 4.0” with guidelines to support SMEs to retrofit old machines giving them 4.0 capabilities at a low cost
Recently The Pulp and Paper Times spoke to Mr Joao Cordeiro, Head of Pulp & Paper at AFRY, a European leader in engineering, design, and advisory services, with a global reach, on the various existing and future-oriented aspects of paper-making technologies, ERP solution, Industry 4.0 and other issues with regards to global paper industry and specifically Indian Paper industry. Here is his full Interview:
Q: Please give us a small introduction to AFRY?
AFRY is a European leader in engineering, design, and advisory services, with a global reach. We accelerate the transition towards a sustainable society. We are 17,000 devoted experts in infrastructure, industry, energy and digitalisation, creating sustainable solutions for generations to come.
AFRY Process Industries division delivers leading engineering and consulting services for the global Pulp & Paper, Chemical, Biorefining, Mining & Metals and Food & Beverage industries, with a special focus in growth sectors such as batteries, green hydrogen, cellulosic manmade textilefibres and plastic recycling.
Our offering extends the entire business lifecycle, from early strategic development phases to large CAPEX implementation projects and rebuilds, including operational support, and is based on a strong combination of process technology competencies, multidisciplinary engineering expertise, and project management capabilities. Digitalisation, safety, and sustainability are key to our services.
AFRY has held a firm leading position in advisory, design and implementation of large-scale biomass refining projects for more than six decades, on a global scale.AFRY is ranked #1 in Pulp & Paper, #2 in Food & Beverages, #3 in Chemicals (non-petroleum) #7 in Mining, and as #9 in steel and non-ferrous metals. (Source: A2021 Engineering News-Record (ENR) Global Sourcebook)
Through the AFRY groupwide offering clients gain access to a portfolio of cross-sector consulting and technical services covering environment, infrastructure, industry, energy and digital solutions, which are critical in all industrial projects.
At AFRY, our mission is to accelerate the transition towards a sustainable society. We are fully committed to support our clients in further developing and improving their sustainability achievements in all areas of environmental and social performance, as these topics form the foundation for our entire operations. Furthermore, we have developed a large number of services around Sustainability and Health and Safety, where we can support our clients on their journey towards a more sustainable future. We are pleased to discuss these topics in more detail.
Q: What is AFRY’s global analysis for Pulp and Paper Industry post-COVID pandemic? What new trends in the Product Mix of Paper Mills arising out?
The world production of paper and board has grown from 50 million tons in 1950 to 422 million tons in 2021. The paper market has been following the ups and downs in the world’s economic activity, with a couple of bigger, temporary disruptions in the 1970s and 1980s, and three contraction points in the 2000s and 2010s. The latest decline in paper and board production, at a global level, was in the period 2017-2020, but overall production rase sharply during 2021.
In the 1990s, the paper market was still growing at an average 9 million t/a. The economic recession and consequent weakening of paper demand in 2008–2009 slowed down the average annual global growth in 2000-2010 to about 7 million t/a.
The markets resumed a growth trend in 2010 in line with the economic recovery. However, the growth of the world paper market remained at a permanently lower level up to 2016 (0.7%/a or 2.7 million t/a). From 2016 to 2017 demand picked up before the impacts of the US-Chinese trade skirmish muted growth again.
One of the most striking features of the global paper and board market in the new millennium has been the fast growth of the rising markets as opposed to stagnating or declining demand in the West. AFRY expects the global paper and board production to reach some 440 million tons by 2025.
The current market can be divided into three main categories: (1) tissue papers, which are used in applications such as toilet rolls, kitchen towels, napkins and handkerchiefs. In relative terms, this is the fastest growing segment and global demand is expected to rise from current 40.5 million tons to 46.3 million tons by 2025.
The second segment is the largest comprising of (2) packaging and industrial papers and boards. Global consumption reached some 280 million tons in 2021 and is expected to rise above 304 million tons by 2025. It benefits from the global sustainability trends as fibre-based packages are preferred in many applications, even substituting single-use plastic packaging solutions. Corrugated containers, folding boxboards, sack and kraft papers benefit tremendously from the rise of e-commerce as they are used as transport packages.
The third segment are (3) graphic papers, used in magazines, newspapers, as copy papers and for periodicals. This group of papers has been suffering strong substitution from digital media – global demand for graphic papers is expected to decline by 2 million tons in the next 3-4 years, from the current 93 million tons consumption.
Q: Indian Paper Industry has faced the heat of non-availability of recovered paper in last two years, does AFRY think that paper manufacturers should think about alternative fibers such as Agro Residue? Can technology help a paper mill to run Paper machines on both fiber (Recovered and Agro)?
The growth of recovered paper collection is slowing down globally due to already high collection rates in many mature markets. India and emerging Asia, as well as Latin America, still have prospects to increase collection rates and volumes from the present levels – but this requires a major change of consumer habits and the build up and improvement of existing recovered paper (and waste) collection infrastructure and networks. With the present recycling networks, any gains in terms of collection volumes in the emerging Asian countries will be hard to achieve.
In addition, the weakening availability of graphics papers for collection will hamper the collection volumes across the globe and become an obstacle for increased usage. In tissue paper, high grades will lose share to bleached kraft pulps, and in consumer boards, the use of ONP, mixed paper and high grades will be replaced by mechanical, chemical and semi-chemical wood pulps.
Non-wood pulp production still accounts, globally, for only a small part of the pulp industry. Although many non-wood raw material resources are available, current non-wood capacity is only about 4% of the global pulp capacity. Bamboo is probably the most promising non-wood raw material for further processing due to unrestricted harvesting time and the relatively large size of bamboo stems. Sugarcane bagasse fibres are also suitable for a wide variety of papermaking applications, but typically those industrial residues are priced based on their energy value, which often reduces the competitiveness. New technologies being developed to utilize straw from agriculture crops (such as wheat and rice) promise to improve the quality and economics of scale for production. However, non-wood raw materials face strong competitive pressures from wood pulps. The main challenges of non-wood pulp typically include
1) Pollution issues and tightening environmental control,
2) Relatively small size and high capital requirements of non-wood pulp mills, as well as
3) Seasonal supply of raw materials connected with logistic and storage problems.
Quality issues relating fibre characteristics also exist, primarily due to the high silica content of non-wood fibres. Despite increasing interest in non-wood opportunities in specialty applications, the global share of non-wood pulps in papermaking is expected to remain only marginal in the future.
Q: Being an engineering and consulting company, what are the grey or focused areas AFRY does see in the paper industry process which need to be addressed at the preliminary level?
Please see other responses
Q: The industrial world is facing rapidly changing challenges. Our resources are finite, and we all need to do more with less. Digitalization and automation are the game changers to meet these challenges on the way to Industry 4.0. It is essential to collect, understand and use the massive amount of data created in the Industrial Internet of Things (IIoT). How does AFRY support the Industry 4.0 concept in the paper process?
To be successful in the future business environment, companies must adopt industrial digitalisation at individual sites and end-to-end across the value chain, from raw material to end-user markets. Digital solutions within industrial production can help businesses to evolve and increase productivity, improve the efficiency and traceability of supply chains, enhance overall efficiency, reach better safety, predict more accurate production volumes, or prevent unscheduled maintenance stops.
At AFRY we continuously improve utilisation and integration of data and digital technologies to optimise project execution and to ensure that engineering data (ET) is available in one single source from the early project phases to the operational phase, enriched with operational data (OT). In our opinion, the solution to the digitalisation dilemma demands not only an expertise of application solutions but, more importantly, a sound understanding of industry technologies and processes.The digitalization focus is on boosting productivity and process reliability, while minimising operating costs and increasing sustainability of the industrial operations.
Typically, industrial operators already gather data from production processes, production control systems, business control systems and even their partners. However, this data is utilised only marginally, and is limited to specific operations, or is not used at all. When taking the next step and combining the data collected from various sources on a single platform and having the option to input additional data, we can easily optimise production processes, develop operation models as well as effectively make strategic business decisions.There is a generally established concept that sustainability is only achieved at the expense of productivity and efficiency. Digitalization of industrial processes help the companies to improve the utilization of the natural resources such as energy and water, by reducing losses and inefficiencies in the production and operational processes, thus directly supporting companies to reach their sustainability goals.
For instance, the World Economic Forum created a new term for describing this convergence between Technology and Sustainability called Eco-Efficiency which is defined as “Eco-efficiency is the outcome of 4IR technologies that, when directed to solve business problems, simultaneously boost productivity and sustainability. This concept of efficiency has three dimensions. 1) First, it involves digital technology that enables data-informed actions across production and the end-to-end value chain. 2) Second, it demonstrates measurable improvements across performance indicators including cost, agility, convenience, and quality. 3) Finally, it drives sustainability gains by reducing consumption, resource waste, and emissions.”
Q: Being a Capital intensive industry, can a small or medium size paper mill imbibe the Industry 4.0 concept to increase its operational efficiency at an affordable cost?
Yes, one of the main characteristics of the digital technologies is that it doesn’t depend on large CAPEX investments to be done. Most of the Industrial IoT solutions, for example, can be implemented following the “As a Service” (or SAAS) Business Model, which is very common in the Internet world and without (or with very low) CAPEX required. Another initiative worth to mention is the one created by the German Association of Machine Manufacturers (VDMA) which recently created a methodology called “Retrofitting 4.0” with guidelines to support SMEs to retrofit old machines giving them 4.0 capabilities at a low cost: “In order to remain successful in the age of digitalisation in the future, it is necessary to integrate the large number of existing machines of operators, manufacturers and component suppliers of machinery and plants into the Industry 4.0 world and make them fit for the future. This should ideally be done as quickly as possible and at the lowest possible cost.
However, there are many machines on the shop floors that are not brand new and therefore not interconnected. The existing machines must be integrated into the Industrial Internet of Things (IIoT), a digital retrofit has to render the existing machines „future fit“. However, upgrading existing machines with sensors as well as the interconnection of machines and systems poses major challenges for the companies.”
Our recommendation is that in path towards Industry 4.0 digitalisation strategy needs to be defined first before implementing single digital solutions. It is important to have the holistic view and plan every digital solution to be integrated with each other to gain all the benefits in future.
Q: Does AFRY provide Enterprise Resource Planning (ERP) solutions to Paper Industry? How can ERP help paper mills in making paper processing error-free and profitable?
Yes, we support our clients in the Pulp &Paper Industry to design, specify or upgrade their ERP systems, as part of what AFRY calls the Digital Foundation of the Mill of the Future. The ERP is one of the central components of our AFRY Smart Site framework and although most of the companies today are aware of the importance of the IT x OT Convergence, for the benefit of the optimization of the Operations & Maintenance of industrial processes, our approach goes beyond that and brings the Engineering Technology to this equation.
We support our clients in the P&P industry on realizing the full vertical ET-OT-IT integration ensuring that the key systems are designed (since the early stages of the plant lifecycle) having in mind the data exchange, breaking the silos of information and the “Single Source of Truth” as one of the main components of the Digital Foundation.
Q: How does AFRY study and analyze the whole lifecycle and value chain of a client's business and provide solutions?& Q9. Where does AFRY project Paper Industry in the next decade especially the Indian Paper Industry on the parameter of digitization and automation?
We see the increase of the application and adoption of Artificial Intelligence and Predictive Technologies. Companies are starting to scale up from the small pilot and proof of concept projects and we foresee an wide adoption of this type of technologies in the coming years with the expansion of use cases in areas such as Smart Maintenance (Asset Reliability), Smart Quality, Smart Energy, Smart Worker (Health and Safety). Another trend for large enterprise is the creation of Remote Operations and Intelligence Centers that aims to take automation and productivity to another level, promoting continuous innovation and process improvement, reducing the dependency on high skilled and scarce human resources, thus going forward the autonomous plant operations. These centers are composed of subject matter experts with deep domain expertise in the assets, processes, products, technologies, and services that make up the business.
Q: In an interview with ‘The Pulp and Paper Times’, World Packaging Organization (WPO)’s President claims that Plastic Bags has seven times less environmental impact than to paper bags, he says that in the total picture, the science and technology behind making paper are too costly than plastic. How do you take his claim?
Life cycle analysis are extremely useful tools to verify the footprint of products, services and materials. However, benchmarking the footprint of different products can be difficult as the chosen boundaries of the life-cycle assessment will affect the results. Plastic polymers are feedstocks of great characteristics and typically come at very competitive prices. The issue with plastics is their usage and disposal. Single-use plastics are being banned globally by local authorities, governments, and brand owners. Single-use plastics are goods that are made primarily from fossil fuel–based petrochemicals and are meant to be disposed of right after use—often, in mere minutes. Petroleum based plastic is not biodegradable and usually goes into landfills where it is buried, or it gets into the water and finds its way into the ocean. They also degrade into tiny particles after many years. In the process of breaking down, it releases toxic chemicals (additives that were used to shape and harden the plastic) which make their way into our food and water supply. These toxic chemicals are now being found in our bloodstream and may cause cancer, infertility, birth defects, impaired immunity and many other ailments. Chemical plastic recycling will improve the negative impacts of these materials, but existing fibre-based packaging solutions are excellent substitutes as they are fully compostable, degradable and recyclable. Major brand owners are voluntarily adopting plastic free solutions and often choose a fibre and paper-based solution.
Q: To enhance service support and solution delivery, local strategic collaboration is a good option. Is AFRY looking for a joint venture for better analysis of service requirements on Indian soil?
In order to address the Indian market a local strategic partner network is of the essence. AFRY’s role is to act as technology independent ecosystem integrator brining always the most optimal solution and partners to each customer projects.
AFRY’s leadership originates from more than 60 years of experience and a unique combination of process technology specialist skills, multidisciplinary engineering talent and know-how of thelarge project implementation.As an example, AFRY has selected INFOSYS as our global partner and we have executed together many engineering tools sharing and training activities, including an ongoing Pulp & Paper Mill Expansion in India. This partnership will provide a better understanding of our clients’ needs, requirements, methodologies and also the insight of the local codes and regulations applicable to projects to be implemented on Indian soil.
ITC-PSPD delivered robust performance in the Specialty Papers segment by product mix enrichment
- Strong growth of 36% in Revenue in FY 21-22
- Investments in pulp import substitution, cost-competitive fibre chain, sharper focus on operational efficiency leveraging data analytics and Industry 4.0 enabled margin expansion despite escalation in key input prices.
2022 | The Pulp and Paper Times:
After a sharp decline in FY 2020-21, global demand for Paper & Paperboards witnessed a growth of about 10% in FY 2021-22. Paperboards segment is estimated to have grown faster at about 11-13% on the back of robust demand from end-user industry segments. Higher global demand for virgin grades and continued supply chain disruptions led to international fibre prices remaining elevated throughout the year. Writing & Printing Paper, which had degrown significantly in FY 2020-21, grew at a moderate pace of 5-7% with educational institutions and offices continuing to remain partially closed in the course of the year. The Indian industry witnessed broad based uptick in demand across most end-user segments driven by Consumer Goods, Pharmaceuticals, Food Service and e-Commerce.
ITC’s Paperboards and Packaging Businesses are moving to the ITC Next horizon by scaling up the Value-added Products portfolio, enabling pulp import substitution for superior products, and pioneering innovative fibre-based solutions, leveraging its existing proprietary R&D platforms and global collaborations. The Paperboards and Specialty Papers Business offers next generation sustainable packaging solutions, including recyclable paperboards and papers with barrier properties, under the ‘Filo’ and ‘Omega’ series to substitute single use plastics.
Despite significant operational challenges due to the pandemic and continued global supply chain disruptions, ITC’s Paperboards and Packaging Businesses achieved record volumes and higher realisations during FY 2021-22. Structural interventions across the value chain including, inter alia, developing high yielding clones, augmenting value added paperboard & in-house pulp manufacturing capacity and creating superior distribution infrastructure, product & process innovation, digital interventions including Industry 4.0 continue to provide the Business sustainable competitive advantage.
The Paperboards, Paper & Packaging Segment recorded strong growth of 36.0% in Segment Revenue and 54.7% in Segment Results. This was aided by demand revival across most end-user segments, higher realisations, product mix enrichment and exports. Robust margin expansion of appx. 270 bps was achieved leveraging the integrated nature of the business model, Industry 4.0 and other digital interventions.
ITC-PSPD is actively engaged in developing and promoting suitable paper and paperboard substrates to replace single-use plastics. ‘FiloPack’ and ‘FiloServe’ under the ‘Filo’ series are certified as ‘100% Recyclable’ by Central Pulp & Paper Research Institute (CPPRI), while ‘OmegaBev’ and ‘OmegaBarr’ under the ‘Omega’ series are certified as ‘Bio-degradable under compostable environment’ by Central Institute of Petrochemicals Engineering & Technology (CIPET). These products, which serve as alternatives to plastic-coated containers, cups and other deep freeze applications, registered robust growth during the year and continue to gain popularity with increasing awareness levels amongst customers.
The portfolio was also augmented with the launch of a new range of Specialty Papers for e-ommerce/ courier envelopes and paper tapes. ITC-PSPD is stepping up investments in this fast-evolving space which holds immense growth potential supported by the R&D capabilities of your Company’s Life Sciences and Technology Centre and through external collaborations with global specialists. To rapidly scale up its future-ready product portfolio through cutting-edge innovation, the Business has also set up a dedicated ‘Nextgen Cell’ which is actively engaged in building a robust innovation pipeline.
During the year, ITC-PSPD delivered robust performance in the Specialty Papers segment. Market standing stood enhanced during the year driven by product mix enrichment, diversification of the customer base and launch of innovative products such as anti-viral and anti-bacterial Specialty Paper - ‘NPP Pro’ for use in pharmaceutical leaflets and packaging applications. The domestic industry continues to remain under pressure on account of cheap imports from China. The recent introduction of anti-dumping duty on Décor paper is expected to increase ‘Make in India’ opportunities and enable import substitution.
ITC-PSPD continues to make structural interventions to reduce dependence on imported pulp, enabling substantial reduction in operating costs. Significant increase in in-house pulp production was achieved through strategic interventions, Industry 4.0 initiatives and improved wood mix. Capacity utilisation of Bleached Chemical Thermo Mechanical Pulp mill (BCTMP) at the Bhadrachalam unit touched a record high during the year. Initiatives such as bund plantation and scaling up plantations in new catchment areas in Odisha and Chhattisgarh have enabled procurement of more than 10,000 MT of wood from these areas, with further potential for increasing cost-effective access to fibre in the future.
In addition, ITC-PSPD recycled around 1.1 lakh tonnes of waste paper during the year, thereby sustaining its positive solid waste recycling footprint.
“In the current year, the Company has achieved over 99% waste recycling. In addition, the Paperboards & Specialty Papers Business recycled over 85,000 tonnes of externally sourced post-consumer waste paper, creating yet another positive environmental footprint. Going beyond the requirements of Plastic Waste Management Rules, 2016, we are endeavouring to ensure that, over the next decade, 100% of packaging is reusable, recyclable or compostable/biodegradable,” said Mr Sanjiv Puri, Chairman & Managing Director-ITC Limited, in the Sustainability & Integrated Report 2022
ITC's Paperboards Business adopts Cutting-edge Industry 4.0 Technologies to Drive Sustainability & Competitiveness
In line with ITC's focus on accelerating digitalisation across businesses, ITC PSPD (Paperboards & Specialty Papers Business), the leading manufacturer of Packaging and Graphic Boards in South Asia, is implementing several transformative projects leveraging Industry 4.0 technologies across key business areas, to enhance productivity, reduce carbon footprint, achieve strategic cost efficiencies and superior product performance. Some of the major projects undertaken by ITC PSPD as part of its Digital Transformation Programme include – process debottlenecking and throughput improvement for productivity and Overall Equipment Effectiveness (OEE) improvement, product quality superiority for process capability improvement and reduction in defects, resource optimisation, and imports substitution for variable cost reduction, and sustainable agricultural practices for improved field productivity and reduced carbon footprint.
E-learning will support the paper industry, and love for books will never end : Ankur Bindals
- Students will print the study material and resort to paper-based notes for studies
- Going for backward integration to secure 100% raw material availability
E-learning will support the paper industry. The demand paper remains as students will print the study material and resort to paper-based notes for studies. The people’s love for books will never end.
With normalcy returning in all sectors, the paper industry is also getting its groove back. The schools are back to normal, and written exams are held in both schools and colleges. With this, the new education policy is also being implemented, which would further boost the demand for writing printing paper. Mr. Ankur Bindals, Managing Director, Bindals Papers Mills Limited, shares his insights about the waste paper crisis and discusses WPO’s claim about the paper industry and the price hike. He also shares light on the new education policy and its overall impact on the paper industry and its supply and demand.
May 2022 | The Pulp and Paper Times:
Q: What is the future of the paper market post covid?
Overall, covid has impacted the paper industry a lot. The market has fluctuated a lot in the last two years. We are in the writing printing and copier paper segment, and due to the shutting down of education and government institutions in lockdown, it suffered the most. Now everything is going back to normal the market is heading towards stabilization. In fact, in the last three months, the demand and prices both have witnessed an upward trend, the reason being the rise in the cost of waste paper, fuel, and raw materials. We use agro-residue, and even its prices have increased. So, there is no question of the market going down in the future.
Q: How much time paper market will take to reach normalcy?
In my opinion, the market has reached its normalcy post-covid, and the market is stable. I think the demand for paper will reach its pre-covid level by next month. During and after covid, the paper mills have a new segment – Cup Stock. It has played a good role in the market.
Q: How will the new education policy benefit the paper industry?
It will benefit the industry a lot. Due to the new policy, new books will be printed and published, boosting the demand.
Q: As the government is inclined towards e-learning, will it impact the paper demand?
E-learning will also, all in all, support the paper industry. If the demand for publishing paper goes down, then the demand for copier paper will go up, as students will print the study material and resort to paper-based notes for studies.
Q: It is heard that the European Authority will regulate waste shipments. If this happens, then getting imported OCC will be a challenge. In this situation, what alternatives do the Indian Paper mills have?
Today, the percentage of waste paper collection in India, compared to developed nations, is low. With increasing waste paper prices, the collection rate in India is gradually increasing. As a result, there will be stability and availability of waste paper in the future.
Q: As per World Paper Organisation, paper mills, compared to plastic industries, are energy, resource, and technology-intensive. However, there is seven times less impact on the environment in plastic when compared to paper. What is your take on this?
I would disagree with that. I don’t know the parameters and basis of comparison. Although paper mills can be energy and resource-intensive, the paper industry is at such a stage that many kraft papers and duplex paper mills are running on zero liquid discharge. Paper mills comply with CPCB and government charters and contribute to the environment, as the raw materials are renewable. Many tree-based paper mills in India are encouraging farmers to plant more trees.
Q: Paper industry is facing a coal shortage. What is the reason behind it? And how will it impact paper making?
It is a worldwide challenge, and this crisis will remain for another few months. It would take another six months to a year to get solved. This shortage has increased the cost of production, and it will remain the same due to cost pressure.
Q: Don’t you think a continuous rise in paper prices will propel the sale of alternate e-book reading devices? How do you see this?
Both paper books and e-books go similarly. E-learning has its way of working, and paper has its own. The students who want to write will make notes in their notebooks or take printouts on copier papers. The people’s love for books will never end.
Q: Have you launched any new products recently?
Recently, in the last three months, we launched cup stock, which is growing well. We are also exporting the same. And there is a stable growth in our copier paper segment.
Q: Any expansion you are planning?
We are going for backward integration, and to secure 100% raw material, we have planned to set up a sugar mill and distillery in Bijnor, Uttar Pradesh.
Kraft Paper demand to pick up in upcoming months, volatility in export market, customers' reluctance to increase price; Astron Paper reports INR 303 Cr revenue for 9 Months ended Dec. 22
- Raw material prices are in the last 2 or 3 quarters soaring very high as against this, the Sales prices are to match up or increase.
- Challenges in exporting the finished goods recently due to freight prices and other constraints of Shipping Lines
- Demand for Kraft paper will be strong and increasing as the demand for kraft paper will be more in industries like Groceries, E-commerce for packaging, ceramics etc
Ahmedabad | 15th Feb 2023 | The Pulp and Paper Times
One of the largest recycled corrugated paper manufacturers in India, Astron Paper and Board Mill Limited (APBML) reported a total Revenue for the nine months ended were Rs. 303.19, down by 17.97% YOY vs Rs.369.62 crores reported in Corresponding Nine months ended December 31, 2021 in the previous year. The company has reported Net Profit/(Loss) after Tax of Rs. (22.56 Crores) in the 9 months ended December 31, 2022, as against profit after tax of Rs. 7.93 Crores in the 9 months ended December 31, 2021 in the previous year.
“In the current scenario, the raw material market, International and Domestic market for Waste Paper is highly volatile and un-predictable. Raw material prices are in the last 2 or 3 quarters soaring very high as against this the Sales prices are to match up or increase. Due to decline in regular exports, the sales volume and sales price what the company was getting in the earlier quarters, the same could not be meet out in the recent quarters. However, the company is hopefull to regain it’s position in export market as well. There is a reluctance from the customers of accepting any increase in the sales prices. Further, post Covid impact and the prevailing Russia-Ukraine War is also one of the a factor resulting in an increase in the shipping cost.” Astron Paper and Board Mill stated in its press note.
APBML admits that it is facing challenge in exporting the finished goods recently due to freight prices and other constraints of Shipping Lines. Morever, the demand for kraft paper at international market is also volatile. However, company’s dedicated Marketing team is geared up to focus on the targeted Market at domestic as well as International level.
APBML’s strategy is to increase export of finished goods to fetch the required sales price what it was earning when the fluctuation in export was there. To sustain in the competitive market and to overcome cost of raw material, shipping cost and other expenditure, increase in export sales will play a major role.
“Due to International downtrend in the paper industry sales price seems to be highly fluctuating in the local as well as global market and in order to compete the market, the Sales prices needs to be adjusted which can be done gradually. However, APBML is confident that in upcoming months the demand for Kraft paper will be strong and increasing as the demand for kraft paper will be more in industries like Groceries, E-commerce for packaging, ceramics etc.” the press note said.
Astron Paper has carried out necessary upgradation and modification in the boiler and turbaine located at Halvad plant,with this upgradation, it will result in reduction of fuel cost, reduction in electricity and will enhance productivity, overall it will help us to maintain better environment.
“Considering the tough market conditions due to high input costs we are happy to share that we remain afloat in this tough unprecedented time too . This was possible with focus on enhancing our internal efficiency and marketing our products meritoriously,” the management says in the press note.
Satia Industries got additional orders of INR 350 Cr; robust growth in writing and printing paper segment led by New Education Policy
-The management is well on track of achieving its target of 50% increase in production of paper on YoY basis.
- Revenue from operations is likely to grow by over 100% in FY23.
- SIL is committed to improve its EBITDA margins by 100 basis points YoY in current year
Punjab, India | February 10, 2023 | The Pulp and Paper Times:
Satia Industries Limited (SIL), one of the leading Wood and Agro-based paper manufacturers in India bagged additional orders from RSTB, Jaipur, Telangana and Bihar all three totalling over 16000 tons with a total worth of almost Rs 350 crore. This demonstrates buyers’ trust in Satia’s potential to fulfil upcoming enhanced demand of writing and printing paper with New Education policy (NEP)
Satia Industries reports Revenue from operations increased by 125% on YoY basis from INR 2,163 Mn in Q3FY22 to INR 4,868 Mn in Q3FY23, mainly driven by better product mix and higher sales realization. For 9MFY23, revenue from operations grew by 129% to INR 13,631 Mn
Commenting on the financial results, Executive Director Mr. Chirag Satia, said: “We are pleased to deliver an excellent quarter and fiscal in terms of volume as well as increased profits. The Revenue from Operations has increased by 125% in Q3 of FY23 vis-à-vis Q3 FY22 which was the result of higher capacity utilization, strong demand leading to higher sales volume and improved realizations.
“Besides three major contracts for supply of paper for printing textbooks from Bal Bharti, Pune, Maharashtra: Punjab School Education Board, Mohali, Punjab and UP for over 17,000 tons; Company got additional orders from RSTB, Jaipur, Telangana and Bihar all three totalling over 16000 tons with a total worth of almost Rs 350 crore.” Mr Satia Informed.
The Educational sector along with spurt in domestic demand of paper across the nation in addition to our continued strong association with State Textbook corporations, remains the key strength of the company. Paper Industry in India is expected to grow at compounded annual growth rate of 8-9% over the next 5 years on account of robust growth in writing and printing paper segment led by New Education Policy and govt focus on increasing literacy level in India.
Andhra Paper intends to invest INR 2000 Cr. in a new Paper Board machine with a 175,000 TPA capacity
Rajamahendravaram | 31st January 2023 | The Pulp and Paper Times:
Indian packaging industry is expected to report a CAGR growth of 5-6% between 2022 to 2027. Packaging is a fast-growing industry catalysed by rising disposable income, growing consumer awareness and rise in processed food offtake.
Gauging the growing demand for board market in India, One of the largest integrated paper and pulp manufacturers in India- Andhra Paper Limited (APL) has accorded an in-principle approval to prefeasibility report to exploit opportunities in Paper Board Segment through expansion and capacity addition by setting up an integrated Green Field Project at Unit Kadiyam.
Pursuant to the provisions of Regulation 30 (4) of the SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 ('SEBI LODR Regulations"), we wish to inform that the Board of Directors at their meeting held on January 31, 2023 have accorded an in-principle approval to prefeasibility report to exploit opportunities in Paper Board Segment through expansion and capacity addition by setting up an integrated Green Field Project at Unit Kadiyam.
The submission to SEBI says, It is proposed to install approximately 175,000 Ton per annum board machine (KA#4) along with ancillary and support infrastructure concerning the project. The existing production capacity is 87,000 TPA. The proposed capacity addition is 2,21,000 TPA (Pulp) and 1,56,000 TPA (Paper Board). In this regard, the Company will file necessary applications with the Ministry of Environment & Forest for Climate Change (MOEF) for Environment Clearance and further approvals concerning the project shall be sought from concerned regulatory authorities including local, state and central authorities as may be necessary for the proposed project. The final approval for the project shall be granted by the Board subject to the Company obtaining the requisite approvals from concerned authorities.
The project commencement will be subject to approvals from MOEF & other concerned authorities and thereafter a comprehensive final proposal will be put up to Board for approval.
In India, Paperboard demand is expected to grow sharply 9-11% CAGR over fiscal 2022 to fiscal 2026. E-commerce boom, Super markets, Ban on single use plastic, packaging of processed food stuff, better quality packing, environment friendly measures has led to opportunities in the paper Board segment where the Company sees a good opportunity for capacity expansion through investment in new Machinery and requisite infrastructure subject to necessary approvals.
In volume terms, the Indian paper and packaging board market is expected to have grown by 13% in 2021-22 compared to a de-growth of 17% in 2020-21. The printing and writing paper segment is expected to have grown by 23% in 2021- 22 compared to a de-growth of 34% in 2020-21. The packaging board segment is expected to have grown by 31% in 2021- 22 compared to a contraction of 20% in 2020-21. The coated paper segment is expected to have grown by 28% in 2021-22 as against a contraction of 39% in 2020-21.
DPIIT: 532 mills are in operation with a total operating capacity of around 24.32 million tonnes
- In India, per capita consumption of paper is about 16.71 kg, which is far lower than the world average (57 kg. in 2020).
- Out of 125 newsprint mills, 46 mills have stopped making newsprint chiefly due to demand-related reasons.
- Department for Promotion of Industry & Internal Trade (DPIIT)’s Annual report on Indian Paper Industry for FY 21-22
The Pulp and Paper Times | 2022
Indian paper industry accounts for about 5% of the world production of paper, paperboard and newsprint. Govt. of India’s policy for discouraging the use of single use plastic has had a positive impact on the fortunes of the paper sector, particularly the packaging segment. Demand for paper also continued to be fuelled by requirement of quality packaging for FMCG products, ready to eat food and various macroeconomic initiatives being taken up by the government Indian paper industry is a de-licensed sector and 100% FDI inflow is allowed on the automatic route. The FDI equity inflows in the sector for FY 2020-21 is Rs. 166.66 crores. The industry structure comprises of more than 900 paper units, with an installed capacity of nearly 29.11 million tonnes out of which 5.51 million tonnes lies idle for various reasons.
As on date around 532 mills are in operation with a total operating capacity of around 24.32 million tonnes. In the year 2020-21 total capacity utilization stood at around 89% and total consumption of paper, paperboard, and Newsprint stood at 21.21 million tons. Total production for the year of 2020-21 stood at 21.70 exhibiting an increase of 5.28% on YoY basis.
There have been few moves of consolidation within the sector, but Indian paper industry remains largely a fragmented sector. It consists of small, medium and large paper mill having production ranging from 5 to 2000 tonnes per day. The sector uses wood, agro residues and waste paper as input substrates for production. Presently, in the total production, the share of wood, agro and waste paper-based mills stand at 18%, 6% and 76%, respectively. It has been recorded that most of the new green or brown field projects are coming in Packaging Grade Sector and most of them are based on Recycled Fibre (Waste Paper). Hence, total share of RCF paper-based mills are exponentially increasing.
The newsprint sector in India has a prime role as an information carrier in cities as well as in village hinterlands. Looking into its importance, the government has put in place a Newsprint Control Order (NCO) 2004 in place which ensures fair trade and equitable availability of Newsprint to all printers and publishers. At present, the newsprint can be imported in to the country at 5% BCD subject to an actual user condition.
At present, there are 125 mills registered under the Schedule to the NCO with a total installed capacity of 3.30 million tons. However, as per INMA, currently out of 125 newsprint mills, 46 mills have stopped making newsprint chiefly due to demand related reasons as over 50% of the newsprint demand is being met by imports. Therefore, present domestic installed capacity of newsprint is 2.2 million tons, whereas production of newsprint in 2020-21 has been reported to be only about 1.0 million tonnes, which is stagnant since last two years. As per industry sources, this stagnancy in the newsprint production comes due to increase in cheap imports of Newsprint from overseas countries.
However, the import of Newsprint in 2020-21 stood at 0.66 million tons, which is almost 51% lower than volumes imported in 2019-20.
Impact of COVID—19
The paper industry faced tough times as the first wave of COVID hit the country. Due to the lock down, there was complete disruption in inwards and outbound supply chains. (In particular, the domestic supply chain of recovered which reflected its impact in Import of Waste paper).
This impacted over 70% of the production in one go. Initially, only 30% industry started their operation with 70% capacity utilization. But, as on date (December 2021) it has been informed by the industry source that a V shaped recovery has been achieved by the paper industry, particularly the writing/printing segment. One of the quickest segments to recover from the pandemic effect was the packaging sector. However, there were some very important take a way for industry stakeholders presented by the pandemic. The industry used this to its benefit during the second phase of the
‘Our Hydraulic Jet headbox is designed and manufactured with the latest European standards, running successfully at Emami Paper Mills’ – Scan Machineries
- Scan Machineries is also doing a 400 TPD project for Suvarna Durga Paper Mills in Hyderabad
- Recently, supplied a complete Hydraulic Jet Headbox to Emami Paper mills.
- We are the only supplier offering the highest quality and cross-directional uniformity of paper web in the market with our headboxes
- We also partner with European companies to update our machines and give rise to new product offerings with immense value for our customers.
The ED of Scan Machineries Pvt. Ltd., Mr Vinod Nargunam, recently spoke with The Pulp and Paper Times. Mr Nargunam talks about the paper machine market scenario, new advancements & product developments, new projects and technological up-gradation in paper machine manufacturing. This is the complete interview:
August 2022 | The Pulp and Paper Times:
Q: Please give us a small introduction of Scan Machineries
Scan Machineries engineers, designs and manufactures complete paper machine production lines and undertakes turnkey paper mill projects for paper mills present around the globe. Scan also designs and manufactures Hydraulic Jet headbox, Rectifier Roll Jet headbox, Swimming Calendar Rolls and High Speed Winders and Rewinders. We undertake rebuild projects and have also been offering our consultancy services for Paper Mills around the globe. Our Passion for Paper has always been our motto and we strive to offer supreme quality and engineering of Paper Machines, it’s parts and services for our customers.
Q: Please shed some light on the Paper Machinery Market post-COVID, What is the situation?
After the COVID, demands of paper have increased on many fronts and now the writing printing paper market has also come back and there are more and more packaging demands. The market is going up and we as machinery manufacturers have got good orders at the moment. The customers want the best technology at a very cost-effective price which we at Scan Machineries are able to meet that expectation. Recently, we have supplied a complete Hydraulic Jet Head box with Emami Paper mills. We already commissioned a new 200 TPD plant at Siliguri. We are also doing a 400 TPD project for Suvarna Durga Paper Mills in Hyderabad. So all these projects are with the latest technologies and the one with Suvarna Durga is a completely closed draw starting from the wire section to the unirun section. Customers can also inbuilt a shoe press with very little modification in the future. There are more products that we are developing, and today there is no need for Indian paper mills to import anything second-hand. Previously about 10-15 years back customers were importing everything from Europe (second hand) and now we as manufacturers have increased our technology to the latest standard. We have improved our technology to the state of art and we are able to meet all our customers’ demands.
Q: Please share your success stories of engineering execution and its delivery.
Scan Machineries constantly updates and improves the designs of our paper machinery to the latest standards and quality. We also partner with European companies to update our machines and give rise to new product offerings with immense value for our customers. We are manufacturing many Hydraulic Jet headbox and Rectifier Roll Jet headbox completely in-house in our production facility. Our Hydraulic Jet headbox is designed and manufactured with the latest European standards and is presently running successfully at Emami Paper Mills offering the best cross-sectional profile with a uniform fiber jet in the market currently. Our Rectifier Roll Jet headboxes have been sought after in the market for it’s high performance and we have received orders from many Paper Mills both in India and for exports such as Waraq Paper Mills, Saudi Arabia. Our high speed winders and rewinders are located at various places all over the globe with new technology offerings such as automatic splicing and automatic slitter positioning systems for increased safety and productivity. Our swimming calendar rolls which have been manufactured in house are running excellently in our customers locations. One such customer had decided to replace their Chinese bought calendar with ours and is extremely satisfied with the quality. Our execution of Turnkey Paper Mill projects have been implemented at various Paper Mill locations such as Kenya and Zambia. All in all, if a person decides to setup a Paper Mill project. They just have to send us an enquiry or give us a call and our team will guide you in every step of your new Paper Mill project journey.
Q: Does technology play an important role in successful delivery? Are you open to any Joint venture for the development of better engineering delivery?
Definitely, it does play a vital role. Scan Machineries is known for the engineering and technology quality of Paper Machinery and the services that they bring to the table. Many of our customers have been witnessing our product offerings and benefits and this has become one of the sole reasons Paper Mills decide to place an order on us. Scan being an engineering company always find ways to constantly update and improve to the latest standards of technology by partnering with European companies. This is the main reason why we are open to Joint Ventures which enable us to offer paper machinery with the highest quality and value for our customers.
Q: What obstacles do you see in paper mill operations which stop a paper mill to grow with better margins?
One of the major obstacles is the non-availability of raw materials and the price factor involved in the raw materials. Financing at low-interest rates also helps Paper Mills grow with better margins whereas high-interest rates would hinder their growth. Non-availability of water within a close proximity is also an issue for Paper Mills. Paper Mills not adopting to the latest technology and expanding their production rate can also hinder the margins. Also better forestry cultivation by allocating separate lands to Paper Mills by a government initiative can help the margins grow on the other hand.
Q: Recently, many paper mills have faced the heat of the waste paper crisis. Now most of paper mills are thinking to shift to the alternative raw material such as agro residues. Are you planning to launch any agro residue machine or rebuild the existing machine?
Yes we are rebuilding the machines in the market for our customers but we are not into the pulping sector of the agro waste. We want to specialize in the paper machine and we want to be the best at it and offer the latest technology in the paper machines to the Indian customers. So our focus is only on that right now.
Q: Any new technology on which you are working and will deliver to Paper Industry in the coming time?
Right now, we are working on the headboxes. Our Hydraulic Jet headbox works very well with significant increase in paper sheet quality. Currently, in India we are the only supplier offering the highest quality and cross directional uniformity of paper web in the market with our headboxes. We are using a different kind of technology which we have improved upon in which we were able to get very good results of the end paper sheet quality with our customers such as Emami Paper Mills and we are also having two or three orders on the pipeline. In India, right now most of the headboxes are imported from other countries. Scan Machineries resolves that issue now by offering the best headbox quality in the market. Our Hydraulic Jet Headbox and Pressurized Rectifier Roll Jet Headbox come along with the most advanced automation in the market. We are exporting our latest pressurized rectifier roll headbox to one of the leading Paper Mills in Saudi Arabia and this will be a significant step for our market growth to other countries and continents.
Q: Apart to head box, any other product you are offering?
Our product offering to our customers have increased significantly. We manufacture High Speed Winders and Rewinders. We are doing very well in winder portfolio, our rewinders are operating at 2000 MPM and we have received a lot of export orders as well. Our current highest we will be able to meet is a deckle of 5.5 meters also at 2000 MP speed. Now our winders come with automatic splicing and automatic slitter positioning systems for increased safety and productivity. We manufacture both Hydraulic Jet headbox and Pressurized Rectifier Roll headbox. Our customers such as Emami Paper Mills have witnessed the significant difference in their paper sheet quality and cross directional uniformity using our headbox. We also manufacture swimming calendar rolls at our own production facility. Our next project Suvarna Durga Paper Mills at Hyderabad will have a fully closed draw Paper Machine supplied by us. With this, the paper mill will be able to produce both lower GSM as well as higher GSM in a very efficient way as there's no open draw from the press section up to the unirun and there is very little modification to be done when the customer decides to in built a shoe press on to the press. This will significantly improve the runnability of the machine and we'll be the first manufacturer in India to offer that to our customers.
Q: There has been a perception among the top paper mills of India that the international paper technology suppliers are better than the domestic suppliers. What reason behind do you see?. Why do our domestic suppliers even they are nowadays working on international orders, are not at par to the international supplier?
Firstly I would like to point out that International suppliers invest heavily in their Research and Development projects to better their state of the art technology. This is much higher than what the domestic suppliers can invest with. That being said, we at Scan Machineries are always finding ways to update our technology to the current state of art by partnering with international companies and increasing the value we bring to our customers. We manufacture almost all the imported products customers used to procure from other countries within our production facility now such as Hydraulic Jet headbox, Pressurized Rectifier Roll headbox, High Speed Winders and Swimming Calender Rolls with internals. Our customers feel the tremendous value we bring to them by our product offerings compared to our competitors in the domestic market and because of this reason leading Paper Mills in India and other countries place orders on Scan Machineries.
Q How do you execute the training and support post-sale of your delivery to the paper mill?
Earlier we used to offer training of our products at the customer’s locations but now we see a sharp rise in offering training to our customers via online applications with webcam flexibility especially in cases of our export clients. One of our commissioning and execution teams also arrives at our client’s Paper Mill location to demonstrate and train their team on our delivered products. We train them in running the machines smoothly and efficiently on a day-to-day basis. Our post sale can be done in both online and in presence where our team is deployed to attend and solve the issues faced by customer.
Q: What is the future of paper industry do you see in next five years?
I have a feeling in next five years, paper industry will have significant growth. Packaging papers and Board and Hygiene Papers are going to be the major sectors at which we will witness tremendous growth. Graphic Papers will not have as much growth compared to Packaging papers but will be a very interesting paper segment which leads to rise of newly adopted particular types of paper.
INR 1385 Cr.: TNPL unit-II commenced production, avoiding the need to buy or import hardwood pulp
- Project consisting of Hardwood Pulp Plant with a capacity of 400 MT and Chemical Recovery Boiler with 20 MW TG
- Project will create direct and indirect employment opportunities for 500 persons.
- TNPL Unit 2, with a production capacity of 2,00,000 MT per annum.
Tiruchirapalli | 29th December 2022 | The Pulp and Paper Times:
Leading the Paper Industry by Adopting Cutting-Edge Sustainable Solutions, Tamilnadu Newsprint And Papers Limited (TNPL) has commenced its Unit-II with state-of-the-art infrastructure of producing hardwood Pulp with a capacity of 400 MT. TNPL is aiming to reduce its dependency on purchase or import of hardwood pulp in order to remain more competitive in the paper market.
Phase 1 of the Mill Expansion Plan of Tamilnadu Newsprint And Papers Limited (TNPL) Unit 2 was inaugurated by Hon’ble Chief Minister of Tamil Nadu Thiru M.K. Stalin, today (29.12.2022) at Mondipatti Village, Manaparai Taluk, Tiruchirapalli District. The Project consisting of Hardwood Pulp Plant with a capacity of 400 MT and Chemical Recovery Boiler with 20 MW TG and its accessories, was implemented at a capital outlay of Rs.1,385 crore.
The Hardwood Pulp Mill and Chemical Recovery Plants installed in the Expansion project are equipped with modern technology. As always, this expansion project also was implemented in a short period, despite passing through epidemic like COVID 19. Further, good quality of pulp was produced within short period of commencement of the trials. Upon commencement of this plant, TNPL Unit II has transformed into an integrated pulp and paper board mill. This project will create direct and indirect employment opportunities for 500 persons.
The multi-layer double coated board plant of TNPL Unit 2, with a production capacity of 2,00,000 MT per annum, commenced the production on 29.01.2016. As a next phase of growth, TNPL had proposed a Mill Expansion Plan (MEP) at a capital outlay of Rs.2,520 Crore, to be implemented in two phases. Now, Unit 2 Mill Expansion Plan Phase 1 has been implemented and commenced its production. The Phase 2 of MEP consisting of Board Machine / Paper Machine with TG shall be taken up after financial closure.
The commencement of the Hardwood Pulp production at TNPL Unit 2 would avoid purchase / import of Hardwood Pulp required for Board production. All the plant and machinery installed in the project are being operated with state-of-the-art control system to produce pulp with consistent quality.
The project will result in overall enhancement product quality,at a reduced cost of production. The installation of these Units will increase the efficiency and productivity of the Paper Board Unit. This project was undertakento fulfil the requirement of Hardwood Pulp.
During the inauguration ceremony, The following were present Thiru. Gangadhar Bandi, IPS, Chief Vigilance officer; Thiru. Nishanth Krishna IAS, Executive Director, SIPCOT; Tmt. E Sundaravalli IAS, Managing Director, SIPCOT, Thiru. SVR. Krishnan, Executive Director, Dr. M Sai Kumar, IAS, Additional Chief Secretary /Chairman and Managing Director, TNPL; Thiru. Ma.Subramanian. Health, Medical Education and Family Welfare; Thiru. S. Krishnan, IAS, Industries, Investment Promotion and Commerce Department; Thiru. Thangam Thenarasu, Hon'ble Minister for Industries, Thiru. M.K. Stalin, Hon'ble Chief Minister, Thiru. K.N. Nehru, Hon'ble Minister for Municipal Administration; Thiru M. Pradeep Kumar, IAS, Collector, Tiruchirappalli District.
Survival concerns for paper mill operations: complete ban on Coal in Delhi-NCR from 1st January 23
New Delhi | 27th December 2022 | The Pulp and Paper Times:
In order to curb air pollution in the National Capital Region (NCR), Commission for Air Quality Management (CAQM) had issued a policy of complete ban on heavily polluting fossil fuels including coal in the entire NCR w.e.f. 01.01.2023.
The Commission through its direction No. 65 dated 23.06.2022 had also issued the approved fuel list and prescribed a complete ban on heavily polluting fossil fuels including coal in the entire NCR.
In this regard, Coal India Limited, vide letter dated 16.12.2022, has provided a list of entities/units/industries to the Commission, those may be involved in using / acquiring / stocking / selling / trading of coal in NCR.
Few days back, Paper Industry association laments the non-equitable coal supplies and urged Prime Minister’s intervention to resolve the issue. The coal availability to paper mills has aggravated to such a level that it is compelling many mills to cut down their production or force closure.
This step by the government will impact several paper mills in Meerut, Muzaffarnagar, Shamli, and Yamuna Nagar. Already paper mills are facing sluggish demand and price drops on finished paper, this ban will add more difficulties for paper mills in order to remain commercial viable against other mills outside NCR.
According to notification, any kind of usage / acquiring / stocking / selling/ trading of coal in entire NCR, except in Thermal Power Plants (TPPs), will be viewed as serious non-compliances/violations of the statutory directions issued by the Commission.
Paper mills use coal in the boiler to generate steam used to dry the wet paper. For past one year, coal is short in supply, affecting work at paper mills. A single paper mill employs around 300 people, of which majority are on contract basis.
The coal procurement indigenously by the pulp and paper industries has been affected forcing them to rely on imports and grid power to produce the paper products. The cost of paper and paper board have skyrocketed due to reliance on costly imports.
Century Pulp & Paper is focusing on the development of multiple products & innovating different forms of pulp
-Clocked a revenue of INR 2,818 crore in FY21-22
-CPP is focusing on the development of multiple products including straw paper for use as replacement of plastic straw, honeycomb or kraft paper used as cooling pads in coolers, water resistant eco-friendly barrier coated board as well as anti-fungal board.
Lalkuan | 22nd July 2022 | The Pulp and Paper Times:
Globally, last financial year was one of the toughest periods for Paper industry. Paper consumption points were not operational for major part of the year. Timely availability of key raw materials remained a challenge. Due to disrupted supplies, cost of couple of these raw materials touched their life-time high levels. In turn, paper manufacturing players passed these increased costs to their end customers.
Century Textiles and Industries Ltd’s chairman Mr. Kumar Mangalam Birla said in its annual report that The pulp & paper industry has been under pressure due to increasing raw material prices, shortage of key inputs like wood and coal, supply chain challenges and short-term demand hurdles due to COVID-19 variants. At the same time, the pandemic has brought focus on cleanliness, creating new opportunities for tissue and toilet paper. The e-commerce boom over the last two years has led to a surge in corrugated and container board demand. Demand is also expected to pick up in FMCG, healthcare & pharma, packaged foods, and the textile sectors, especially for eco-friendly packaging options. The reopening of educational institutions across the country and the implementation of the National Education Policy (NEP) 2020 should also contribute to the demand for writing and printing paper. The proposed ban on single use plastic is expected to further fast-track the adoption of alternative, environmentally conscious options.
Century Pulp & Paper (CPP), India’s leading integrated pulp & paper company who provides comprehensive and innovative writing and printing paper, tissue, multi-layered packaging board and rayon grade pulp (RGP) products to a wide range of customers across the globe. CPP, India’s only integrated single-location manufacturer of writing and printing paper, multilayered packaging board, tissue and Rayon Grade Pulp with a capacity of 4.81 MTPA at our unit in Lalkuan, Uttarakhand.
“We believe that the need to innovate is greater than ever for achieving our vision. We are focusing on improving our process and product portfolio in a sustainable manner. Our focus on innovation and ability to deliver on our commitments helps us to not only stay relevant in fast changing environment but also to become a trusted partner of our customers. Going forward, we are focusing on the development of multiple products including straw paper for use as replacement of plastic straw, honeycomb or kraft paper used as cooling pads in coolers, water resistant eco-friendly barrier coated board as well as anti-fungal board. Our R&D team is also looking at ways to substitute different forms of pulp like wood base, agro base and re-cycle base to formulate new recipes that help reduce per ton pulp usage of paper production,” said Mr. Vijay Kaul, CEO, Century Pulp & Paper
Despite the challenging environment, Century Pulp and paper has grown over pre-Covid levels, with near 100% capacity utilisation. Going forward, the expected increase in demand from multiple downstream industries and the government’s focus on eco-friendly options opens up a host of possibilities for the business. We will be strategically working on expanding our portfolio and our manufacturing and integration capacity to capitalise on the available market opportunities.
“The business reached the pre-covid level despite multiple restrictions being in place in application industry for larger part of the year. The production capacity was fully utilised with average capacity utilisation at 99%, to meet consumer demand. We clocked a revenue of INR 2,818 crore in FY22 as compared to the INR 1,774 crore in FY21, marking a substantial growth of 58.8%. EBITDA also saw a strong growth of 91.9%, growing to INR 424 crore in FY22 as compared to the INR 221 crore in FY21. Efforts to re-align the product mix and increase efficiencies enabled robust performance, partially mitigating the impact of increasing raw material cost. We also took multiple efforts to manage the volatility in the inputs cost, including usage of substitute inputs, inventory management, and induction of new supply partners in addition to re-negotiations with the existing suppliers,” said Mr. J. C. Laddha, Managing Director, Century Textiles and Industries Ltd in the annual report for fy 21-22.
He further says that the demand in this segment is expected to considerably go up. We are applying the pareto principle and looking for machines which provide us increased flexibility and innovative offerings to meet the demand. We are also working on strengthening our raw material sourcing to manage volatility in input markets. Our proficient and visionary R&D teams are in the process of innovating different forms of pulp with the aim to cut down on per ton pulp usage in paper production. Keeping sustainability at the forefront, we are continuing our efforts to come up with unique and eco-friendly methods of using paper products – paper straw to counter plastic straws, turning honeycombs and craft paper into cooling pads and the development of biodegradable water-resistant barrier coated boards. In line with our sustainability commitments, we are looking to increase our local raw material sourcing. As we work on securing our place as industry leaders in each of the segments, we will be looking at both organic and inorganic growth options.
Product highlights FY22:
PE free antifungal ARSR
In line with changing dynamics, the emphasis on replacing plastic in packaging products has been increasing. We recently replaced the PE coating which is treated as plastic in our ARSR products. The new product is used primarily in soap wrappings. In addition to being sustainable, it also has antifungal characteristics, improved quality and a nonstick feature. We see the product gaining significant market share over the next couple of years, as reflected in the market response.
Century Prima MR board
A leading FMCG Company, who are in an elite segment in their industry, approached us with a demand for a customized product. They wanted to commission base board which could be used as a mosquito repellent after chemical treatment at their end. Our R&D team set to work, and we successfully launched the product, meeting all the compliance requirements at the customer’s end. We foresee the monthly demand potential to increase over the next three years from the current levels.
A list of innovations:
It is a unique product, manufactured only by us in the whole country. It has a high and dry wet strength and serves as a transfer and cover sheet for absorbent fluff pulp in diapers and feminine hygiene products.
HIGH BF KRAFT
After a series of experiments in the design lab, we have been able to develop high BF kraft paper by using virgin, unbleached pulp. The eco-friendly, food grade product passes compliance of heavy metal content, pentachlorophenol (PCP) and polychlorinated biphenyls (PCBs) by FSSAI. The product is currently used by some of the major food chains in India.
DISPOSABLE BED ROLL
Our disposable bed roll, launched last year to meet the demand for disposable OPD products, have gained traction in the health care industry. Made of high-quality virgin tissue paper, these rolls offer an eco-friendly, bio-degradable, OBA-free (Optical Brightening Agents) hygiene solution. We are further studying the product to expand its market potential application.
CENTURY GREEN PULP
This pulp is made from agro-waste of sugarcane i.e. bagasse, a completely bio-degradable and compostable product. The pulp is being used to make eco-friendly tableware through moulding technology as a replacement of plastic plates, plastic bowls, thermocol glass and thermocol plates. Tableware thus made from Century Green Pulp are FDA complied and meet the requirements of FSSAI guidelines for packaging products for food.
EXPANSION & MODERNISATION:
During the year, the New Tissue Plant (TM7), to manufacture Prime Grade Tissue paper with a capacity of 100 tons per day has been capitalized. However, due to the ongoing pandemic during Q4, international travels were banned throughout the world. As a result, there was delay in getting visa approvals from the Government of India, for the entire technical team of the OEM supplier. Therefore, couple of teething issues are still pending to be sorted out.
At present, CPP are manufacturing paper from Paper Mill 3 (Bagasse base) & Paper Mill 4 (Recycle base) both having monthly capacity of 7,200 Mt each. We are making technical upgradation, removing bottlenecks and balancing the plants, post which our monthly paper manufacturing capacity will increase to 8,500 Mt from each Machine (PM 3 & 4 individually). This expansion, will also help in reducing overall manufacturing cost (of these two machines) and quality improvement.
As reported last year due to Covid-19 no erection and commissioning activities could be undertaken during 2020-21 for upgradation of Paper Machines 3 and 4 and for installation of a new evaporator. Necessary steps are being taken for completion of erection and commissioning of the said Paper Machines and installation of evaporator by June, 22 and July, 22 respectively.
By 2025, Asia Pulp & Paper intends to begin its enormous capacity in India to produce WPP, tissue, and packaging boards
- India Project is a strategic way forward for us to support APP’s operations in Indonesia.
- APP to produce 1.2 million MT of paper products including printing paper, tissue and packaging board.
- A state-of-the-art facility with technology considered the most advanced in India.
Jakarta, 1 December 2022, The Pulp and Paper Times
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.
The letter of allotment and the incentives offer letter were granted to APP by the Chief Minister of Maharashtra Eknath Shinde and Deputy Chief Minister of Maharashtra Devendra Fadnavis to company representatives on November 29th. “We would like to assure that the state is very much in support of investors coming into Maharashtra and are helping us by opening up more employment opportunities for the people of the state,” said Chief Minister Eknath Shinde. The company was offered various incentives and the exclusive permission to receive 100% of its investment back by way of multiple incentives offered, with provision of a 40 year timeline for receiving the incentive benefits, he added.
A feasibility study is currently being undertaken by APP to ensure the facility meets operational requirements and global sustainability standards including social and environmental impact assessments. The company adds that the production facility in India will source its material from Indonesian operations and it will invest INR 10,500 CR (USD1.2 billion) to develop a state-of-the-art facility with technology considered the most advanced in India.
An APP representative commenting on the company’s decision to establish a production facility in India said: “The India Project is a strategic way forward for us to support our operations in Indonesia while marking our presence in the Indian market which offers bright prospects with its strong growth. With the support of the government we are sure to deliver positive impact to the communities and the industrial ecosystem.”
The facility is expected to benefit the local economy and positively impact 7,000 members of the community through direct and indirect employment. Infrastructure such as roads will also be created or enhanced to facilitate movement of goods and employees accessing the facility.
Once the feasibility study is completed and all necessary approvals are in place, the mill is expected to be operational in stages, beginning from 2025 to full functionality by 2027.
Started in 1972 with Tjiwi Kimia producing caustic soda, now APP run operations across Indonesia and China with an annual combined pulp, paper, packaging product and converting capacity of over 19 million tons per annum. Asia Pulp & Paper (APP) Sinar Mas is a trade name of pulp and paper manufacturing companies that delivers quality products to meet the growing global demand for tissue, packaging and paper
GPMA: The demand position has improved and the market sentiment reversed
-Excess production leads to a price drop of finished paper
The sluggish demand scenario and surge in the price of key inputs like Coal, chemicals, etc. The Pulp and Paper Times takes a sneak view of the current situation and puts our questions before Mr. Sunil Agarwal, President of Gujarat Paper Mills Association (GPMA). Here is his view of the situation:
August 2022 | The Pulp and Paper Times:
Q. What is your current Kraft paper market review? Demand is sluggish in core sector, and prices of finished paper have dropped. Paper Mills are taking a silent shutdown to balance their production with demand. How do you take this situation?
Yes, Market Demand is sluggish in the Core sector and prices of finished Paper have dropped. But it is due to excess production. In my view this market depends on sentiments. Before one-month Sentiments were negative but after 5th July 2022 market sentiment reversed, and demand position improved. And now there is no issue of demand. I am of the opinion that only Sentiments Play major role. Now finished prices are also corrected.
Q: The domestic & imported waste paper price has come down due to sluggish demand for the finished paper, how do you see the next three months for waste paper prices? Would it see a 'surge' again?
Waste paper price comes down drastically in the whole world. In the Month of March - 22 Suppliers said that there is no waste paper material and in my view a major role played by the shipping line. Container availability was low and container freight was high. Now container availability is high and also freight price is down. In the last three-month Paper Mill bear heavy loss due to higher price of imported waste paper. Next three months the Market will be good due to the Festival seasons.
Q: Spike in coal prices, chemical and logistics has escalated the operating cost of paper mill, how does member paper mills of GPMA managing day- to- day operations amid the low demand?
Coal prices are very high from June - 21 till today, chemical and Logistics are also very high. Due to this Conversion cost is drastically high, and Members of GPMA incurred huge losses during this Period.
Q: The EU Commission has issued the proposal for the new legislation on the export of waste (Proposal for regulation by the European Parliament and the Council on shipments of waste), which will also rule the exports of waste paper. This proposed regulation is expected to be implemented by 2025 with certain trade obstacles. It will restrict waste paper export to India and other countries. The situation is going to be worse. Recycled paper mills are heavily dependent on imported OCC. What solution do GPMA think about this problem?
If Waste Paper is banned, the Indian Paper industry will face a problem. In India Our Collection rate of waste paper is very low. But our Government will also try to improve the collection rate of waste paper. This rule will be implemented in 2025. We have three years in our hands. We request our government to improve the collection rate of waste paper to overcome the above situation. Also, the paper industry buys an imported waste paper from USA & Other countries where this rule is not applicable.
Q: Single-Use Plastic ban has been effective from July, amid the paper import monitoring system; do you think India has enough capacity to meet the demand of paper arising out of the ban? Is this benefiting the Kraft paper industry also?
Yes, the Single-Use Plastic ban definitely benefits Kraft Industries, and India has enough Capacity to meet the demand. Right now in a western Region our capacity is around 5 Million tons and total demand including export of kraft is around 3.5 million tons, so we have excess capacity of 1.5 million tons which can be utilized due to this ban.
Q: Any other comments, you would like to mention here for Traders, Raw Material Suppliers, and Corrugators?
Paper Industry future is very bright So traders, RM Supplier and Corrugators I request them to Support Paper Industry. If the paper industry does well it is better for all in my view, I always think to do business in a win-win position.
JK Paper invests INR 578 crore to expand its corrugation business and buys the majority stake
New Delhi | 27th November 2022 | The Pulp and Paper Times:
JK Paper, one of India’s largest Paper & Packaging Board Companies, entered into Share Purchase and Shareholders’ Agreements (SPSHAs) for the acquisition of 85% shares of Horizon Packs Private Ltd. (HPPL) and Securipax Packaging Private Ltd. (SPPL), and the balance 15% within a period of 3 years as per the respective SPSHAs.
JK Paper said it will acquire Horizon Packs Private Ltd and Securipax Packaging Private Ltd in phases for about Rs 578 crore.
HPPL and SPPL together are India’s largest Corrugated Packaging manufacturers with seven (7) plants across the country. In FY 2021-22, HPPL and SPPL had a consolidated Revenue of Rs. 832 Cr. Corrugated Packaging is a rapidly growing segment in the Indian Paper & Packaging industry driven by growth in end-use industries such as Food & Beverage, FMCG, etc.
Speaking on the occasion, Mr. Harsh Pati Singhania, Vice Chairman and Managing Director, JK Paper Ltd. said, “It is a privilege to join hands with India’s largest player in the Corrugated Packaging segment. This together with JK Paper’s upcoming corrugated facility in Ludhiana will establish it as the largest player in the corrugated packaging industry.
The shift in consumer preferences are driving demand for superior quality, eco-friendly packaging. This acquisition gives us an opportunity to benefit from the existing strengths of HPPL and SPPL. HPPL and SPPL’s customers, employees, vendors and partners will benefit from JK Paper’s strong manufacturing knowledge and experience, its high standards in operational excellence, financial management and corporate governance.”
JK paper will acquire 26.92 crore equity shares in HPPL for Rs 19.33 per share and 4.63 lakh equity shares for Rs 1,256.95 apiece in SPPL -- representing an 85 per cent stake in each company.
Waste Paper Procurement: Be Prepared for Evidence, Documentation, and audit Process
17th November 2022 | The Pulp and Paper Times
European recyclers are making an urgent plea to shadow rapporteurs as revised EU rules threaten to severely impact trade of recycled materials risking irreversible economic damage and job losses to Europe’s leading circular economy industries.
Talking to The Pulp and Paper Times over a phone call, Mr. Marc Ehrlich, CEO, VIPA Group says, the new EU Waste Shipment Regulation has been under development for many years now and is under final stages at the EU Parliament level. We believe it could pass the vote at the EU parliament in early 2023. There will be after that some further process between the parliament and the EU Commission, which makes it difficult to predict the date of implementation of the new law and the transition period which is also under discussion.
He further says that the new law will make it extremely difficult to ship recovered paper from Europe into India. This will combine three levels, first - All streams are considered as “waste”. There is no favorable treatment for non problematic streams (recovered paper that can not harm the environment, copper with a value of USD 10’000/to) as compared to problematic streams like mixed waste plastic. Everything is “waste”.
Second, the country of destination (India for example) will need to demonstrate its ability to receive the “waste” and need to prepare all the appropriate evidence and documentation on that. This will be reviewed and evaluated by the EU Commission. I would like to underline that the same administration took about 6 months in 2022 to correct in their database a typing mistake done by the Indian government. We can with no doubt say that we are in the “right” hands !
“And last, the receiver of the “waste”, the paper mill will need to be audited to attest broadly equivalent standards. We do not know what those standards are exactly. Will that cover also CO2 emissions for example ?, he informed.
Mr. Marc emphasises that in order to find a suitable solution for paper mills, the Indian Government should be urged by the Paper Mills Association in India to evaluate this law and consult with the EU authorities.. He added, “all that is known for months already and I am still very surprised of the lack of reaction of the recycling industry (paper mills and metal smelters) in India on that. India will be the most hit country with this legislation and nobody is asking the government to react and liaise with EU authorities”
"At the same time, the collection in Europe will collapse, as the lack of exports will lead to low prices, discouraged investments and we will see job losses. Recovered paper will go more and more to landfills. Nobody is reacting, all will loose, including the Environment !!!" he adds.
Current proposals for the revision of the EU Waste Shipment Regulation threaten to "decimate" the European recycling industry, warns the umbrella organisation Euric. Almost 80 per cent of metal recyclers and more than 70 per cent of recovered paper recyclers expect a decrease in turnover as a result of the provisions currently under consideration. As many as half expect to have to cut jobs, the European Recycling Industries' Confederation (Euric) reported in September. According to the association, the industry as a whole currently provides more than 300,000 green jobs that cannot be offshored, and has an annual turnover of around €95bn.
Century Pulp & Paper: SUP ban will give momentum to WPP demand, subdued forecast for board segment
-Sales have increased by 37% to Rs. 942 Cr. in Q2 FY23 as compared to Rs. 686 Cr. in Q2 FY22.
-Sales realization has increased by 45% in Q2 FY23 as compared to the same quarter of FY22.
-The board segment market is expected to be subdued due to lower demand
Lalkuan | 10th November 2022 | The Pulp and Paper Times:
The largest manufacturer of Paper, Board, Tissue and Pulp, Century Pulp and Paper has registered a 37 percent growth in its sales revenue inQ2 of FY23. Situated at the foothills of Himalayas in Lalkuan, Uttarkhand, Century Pulp and Paper is a producer of excellent quality writing and printing paper, and a leading manufacturer of tissue and board, as well as Rayon Grade Pulp products.
Commenting on the Q2 FY23 results, R K Dalmia, Managing Director, Century Textiles and Industries Limited (CTIL) said, "Building upon the momentum initiated in the previous quarter, the company performed even better in this quarter, especially due to increased market demand during the festive season, favourable impact of the single-use plastic ban as well as several cost-reduction initiatives implemented across our production facilities.
The Pulp and Paper business delivered stellar performance backed by increased demand across all segments with timely price corrections and cost reductions.
Sales have increased by 37% to Rs. 942 Cr. in Q2 FY23 as compared to Rs. 686 Cr. in Q2 FY22. Sales realization has increased by 45% in Q2 FY23 as compared to the same quarter of FY22. The plant achieved overall capacity utilization of 96%.
Writing & Printing paper (WPP) demand is expected to increase on account of the single-use plastic ban despite heavy cost pressure in the domestic market due to imports and price corrections by lower-grade mills. The tissue segment is expected to perform better in Q3, with major tissue consumption centres being fully operational. The board segment market is expected to be subdued due to lower demand and competitive low-priced imports. With the reopening of most paper consumption centres and subsiding high input prices, the short to medium-term outlook for the Indian paper industry appears to be positive.
Satia Industries: better product mix and higher sales realization drive increased revenue in Q2FY23
- Current order book in hand stands at 55 days with attractive price realization
- Profit After Tax stood at INR 508 Mn; up 151 % YoY
- Satia Industries expects to produce 80K tonnes additional paper from PM4 in FY23
Punjab | 28th Oct 2022 | The Pulp and Paper Times:
One of the leading Wood and Agro-based paper manufacturer in India, Satia Industries Limited (SIL) announced its consolidated results for the Second Quarter and Half Year ended September 30, 2022.
SIL has registered revenue from operations increased by 146% on YoY basis from INR 1,867.7 Mn in Q2FY22 to INR 4,592.8 Mn in Q2FY23, mainly driven by better product mix and higher sales realization.
Commenting on the financial results, Executive Director Mr. Chirag Satia, said, “We are pleased to deliver an excellent quarter and fiscal in terms of volume as well as increased profits. The Revenue from Operations has increased by 10.1% in Q2 FY23 vis-à-vis Q1 FY23 mainly on the back of robust demand leading to higher sales volume with better realization. With the commitment and persistent efforts of the management and better utilisation of resources, we have recorded a growth in EBITDA margins by 338 bps in the current quarter as compared to the EBITDA margins in Q1 FY23.
Despite key raw materials like agro, wood chips, and waste paper (Indian) witnessing a significant rise in H1 FY23, SIL’s locational advantage of being in India's wheat belt has given us an edge over other players. This, along with cheap fuel from rice straw & other biomass, and strong backward integration from power to chemical requirements, aided in limiting the impact of macro headwinds and retaining relatively healthy margins for H1FY23.
“We are elated to share that with the successful commissioning of PM4, we have added 100,000 TPA to our installed capacity, taking our total installed capacity to 205,000 TPA. We have imported this machinery from France, and it is one of the most advanced paper machineries in India. We estimate our revenues to grow by more than 90% with increase in profits for FY23” Mr. Satia added.
The Educational sector along with increased exports lead the demand of paper across the nation and our strong association with the various State Textbook corporations provides us a competitive edge. The current order book in hand stands at 55 days with attractive price realization.
Mr. Satia anticipates that the management expect further growth in volumes for H2 FY23 as compared to H1 FY23 and expects to produce 80,000 tonnes additional paper from PM4 in FY23 contributing incremental revenue of INR 7000 million in FY23. The management expects that the EBITDA margins to expand by 100 bps in FY23.
The PM4 has commenced commercial production from 7th February 2022 and has an installed capacity of 100,000 TPA. The new PM4 will enable SIL to have an additional capacity of 300 TPD taking its’ total capacity to ~700 TPD.
SIL had procured three orders one of 11000 MT from NCERT, the second from Textbook production, Bhubaneswar for 9000 MT paper, and third from MP Textbook Corporation for 7,000 tons.
Satia Industries Limited (SIL), is one of the largest Wood and Agro-based paper manufacturer in India. SIL was incorporated by Dr. Ajay Satia in 1980 and commenced its operations in 1984 with a small capacity of 4,850 tonne per year. It surprisingly overtook many of its peer in production, to achieve 1,41,525 MT in FY22 implying a capacity utilization of ~117%. SIL has successfully commissioned their PM 4 and has augmented its total installed capacity to 205,000 MTPA. In last three decades, SIL has witnessed a complete transformation in its operations, and it has become fully backward integrated having integrated pulping, chemical recovery, and power self-sufficiency. SIL has 540 acres of eucalyptus plantations, developed as per Karnal Technology, consumes total treated water discharge, and also compliments the future wood raw material requirements. SIL has a strong Pan-India distribution network with 70+ dealer and 3 branch offices located in Delhi, Chandigarh & Jaipur with total Employee strength of 2,019+.
A major paper production facility will be built in India by Asia Pulp & Paper
Mumbai | 21st October 2022 | The Pulp and Paper Times:
Indonesia's one of the largest paper-making companies Asia Pulp & Paper (APP) which is marketing its products in more than 150 countries across six continents, has got the approval from Maharashtra Government to set up a paper-making unit in Raigad. The Cabinet Sub-Committee of industries department was held on Thursday in which a project worth Rs 20,000 crore of Sinar Mas Pulp paper manufacturing project in Raigad district was approved along with some other projects.
The MoU for the project was signed earlier during the Maha Vikas Aghadi (MVA) government.
According to officials, Sinar Mas Pulp and Paper Pvt. Ltd. (Asia Pulp and Paper) is the largest paper manufacturing industry in Asia and it will be making an investment of Rs 20,000 crore for the first time in India and that too in Maharashtra.
The Rs 20,000 crore will be invested in two phases and accordingly, 300 acres of land has already been allotted for this project at Dherand in Raigad district, and the government intends to provide more land as per the demand of the project.
APP had been seeking land in India since 2017 to increase its presence on Indian soil. In January 2018, APP entered into an MoU with Andhra Pradesh Government for the establishment of one of the biggest paper-making units in Prakasam district. It was one of the biggest Foreign Direct Investments in the country till date amounting to approximately Rs 24,000 crore for a greenfield pulp and paper plant in the state.
According to Media reports, APP decided to withdraw its investment from Andhra Pradesh due to newly elected government of Jagan Reddy’s animosity against his bête noire TDP chief Chandrababu Naidu seems to have got the better of him in his penchant for reversing or scrapping the earlier government's initiatives, in the process upsetting the business applecart.
According to the information by APP’s senior official to The Pulp and Paper Times in 2018, The proposed plant was expected to have 3 to 5 million tonnes per annum capacity with the State-of-Art plant and machinery structure. This will be fully automatic and modernized plant generating 5000 to 7000 direct employments in India. APP was planning to manufacture 10,000 to 50,000 Tonnes-per-day (TPD) Writing-Printing, Kraft, Copier, and Paperboards of all segments
The official informed in 2018 that APP will purchase some Hi-tech equipment from overseas suppliers and some from Indian suppliers, like dryers to save the import duty. As concern to raw material availability, APP would source virgin pulp from Indonesia and waste paper from all over the world.
Started in 1972 with Tjiwi Kimia producing caustic soda, now APP run operations across Indonesia and China with an annual combined pulp, paper, packaging product and converting capacity of over 19 million tons per annum. Asia Pulp & Paper (APP) Sinar Mas is a trade name of pulp and paper manufacturing companies that delivers quality products to meet the growing global demand for tissue, packaging and paper
WPRPC will give flip to waste paper recovery and utilization scenario: CPPRI
- A new Waste Paper Recycling Promotion Center at Delhi set up by CPPRI
- WPRPC center will also be helpful in providing authentic information and data to various stakeholders about waste paper.
- SWOT analysis of this sector for further policy/guideline formulation
- According to Industry estimates, waste paper imports have easily crossed 110 billion rupees mark
New Delhi | 12th October 2022 | The Pulp and Paper Times:
Central Pulp and Paper Research Institute (CPPRI), Saharanpur has been awarded a project on “setting up of Waste Paper Recycling Promotion Center (WPRPC) at New Delhi and Chennai”. The WPRPC-Delhi Centre was inaugurated on 12th October 2022 at Patpadganj industrial area, New Delhi. This is the extension centre of Central Pulp and Paper Research Institute Saharanpur, which will cater the need of pulp and paper Industry including recycled paper collection and promotion activities.
The Chief Guest on the occasion, who also formally inaugurated the center, was Mr. T. Balakumar, CMD- Subam Papes Pvt. Ltd. Tirunelveli ,Tamilnadu, who has recently been nominated as the Chairman of DCPPAI(Development council of Pulp, paper Allied Industry), by Ministry of Commerce and Industry, Government of India. Expressing his satisfaction on this step in the right direction, he emphasized the need of a concerted strategy to be put in place for the benefit of the paper sector at large.
Addressing the gathering from paper industry, Mr. Satpal Gupta, Managing Director of Narsingh Dass & Company stressed the need of improving the waste paper recovery rate in India, he added, “As per the estimates, the present recovery rate in India for waste paper is of the order of more than 50 percent. The recovery rate is fast catching up but is much below as compared to the developed nations like Japan-81%, Europe-71.4 % and USA-68% and is at par with new emerging paper destination South Africa which is at 60%”
The systematic and scientific knowledge about collection, sorting, grading and recyclability will certainly help our paper industry in meeting raw material shortage as well as achieving the future projected paper demand of our country.
Mr. Satpal informed that the domestic paper industry produced 24 million tons of paper in the financial year 2020-2021. 4.32 million tons of paper contributing 18% of total production uses wood chiefly from social forestry. Agricultural residues like bagasse and wheat straw are used to produce 2.4 million ton, contributing 10% of the total production. 17.28 million tons contributing 72%share of the total production was produced from recovered paper and or waste paper. The recovered paper presently constitutes as the major raw material base for the domestic paper industry.
The waste paper requirement taking into consideration of an average of 80-85% yield in the papermaking process, the consumption of recovered paper amounts to 20 million tons per annum.
The event was inaugurated by the Shri T.Balakumar, CMD Subam Papers Pvt. Ltd. Tirunelveli,TN, and Chairman of DCPPAI (Development council of Pulp, paper Allied Industry), ,DPIIT, Ministry of Commerce and Industry, Government of India. The inaugural ceremony was attended by Director of Central Pulp and Paper Research Institute Dr. M. K. Gupta, and the leaders of paper fraternity of India.
India needs more such programs for improving waste paper collection, segregation and utilization. In this perspective, setting up of this WPRPC center is a right step, the objective of this center are:
-Promotion, collection and increased use of waste paper
-Study on Stable Supply Chain and reliable volume of waste paper
-Quality monitoring and improvement
-Data network to ensure quality
“According to 2019 statistics available, the waste paper imports in India have jumped 3.5 times of 2011 level. The imports of waste paper in FY2011 were to the tune of 28.31 billion rupees and reached 91.86 billion rupees in FY2019. According to the Industry estimates, this has easily crossed 110 billion rupees mark, taking into account the rupee devaluation and increase in recovered fiber demand by the industry. It goes to show the dependence of the domestic paper industry on imported waste paper,” Mr. Satpal shared.
Citing the example of Confederation of European Paper Industries (CEPI), Mr. Satpal added that CEPI has unveiled, the updated version of its European harmonized recyclability test method, developed in collaboration with stakeholders in the entire paper value chain, including specialized testing laboratories. The goal of this exercise is to make all paper packaging recyclable by 2025 and reach a recycling rate of 90% by 2030.
The updated CEPI harmonized recyclability test method offers a solid basis for this work and allows paper products across Europe to be tested for their recyclability in identical conditions.
Mr. Jori Ring man, Director General –Confederation of the European Paper Industries, is thus correct, when he said, “To optimize recycling, product design is just as important as the final collection and processing after usage.”
WPRPC center will also be helpful in providing authentic information and data to various stake holders, specifically on –
-Waste price, supply and demand
-Benchmarks on various aspects related to raw material availability, paper production and quality along with different geographical areas
-SWOT analysis of this sector for further policy/guideline formulation
-Development of transaction-based recycled fibre price benchmark to help the industry in reducing the volatility and uncertainty in waste paper procurement prices
-Tracking and understanding market movements over time to correlate price changes
-Segmentation of apparent contract vs spot to understand market dynamics and get insight into where the market is headed
The data and knowledge base generated by WPRPC will help the industry to make fact-based decisions and protect the interest of the sector.
The success of this promotion center shall be depended on the participation of all stakeholders in value chain including paper traders, waste paper suppliers, paper mills and paper users.
Proper strategies and key interventions are required for enhancing the waste collection in the country. CPPRI with the collective support and effort by all the stake holders can make positive contribution towards increasing the waste paper collection, thus contributing to the Govt initiative for Atma Nirbhar Bharat, in context of making indigenous fibrous raw material available to the domestic paper manufacturers and saving valuable foreign exchange.
It is also proposed RCF based integrated mother pulp mills may be promoted from various regions of the country which can provide high quality RCF based pulp to the paper mills in the country. This will help in reducing the production cost, energy cost and ETP operation cost.
Pramod Agrawal CMD Rama paper mills ltd and President IARPMA, Shri R.C.Rastogi MD Khateema Fibres, Director IIP Dr.Tanweer Alam, and Joint Director Dr. Madhab Charkraborty, Dr. B.P. Thapliyal Secretary General IARPMA, Shri Rohit Pandit Secretary General IPMA, Shri Vijay Kumar Secretary General INMA etc.. Senior Scientist of Central Pulp and Paper Research Institute Saharanpur Dr. Kawaljeet, Dr.Priti Shivharelal, Dr. NitinEndlay, Dr.SanjayTyagi, Shri Alok Goel also attended the inaugural ceremony.
CPPRI: Paper Industry contributes Rs. 8000 Crores to the National exchequer with a turnover of Rs.70000 Crores
- The proposal for leasing of degraded forest lands for pulpwood plantations needs to be fast tracked by the Ministry of Environment, Forests and Climate Change (MoEF&CC).
- Urgent need to invest the CSR funds into Research and Development; Gujarat has the maximum paper making units
- The total operating installed capacity in the sector is 23.99 million tons per annum and the production is 21.36 million tons per annum.
2022 | The Pulp and Paper Times :
The annual report of Central Pulp & Paper Research Institute for FY 20-21, reveals that the year 2020-21 will be remembered as historical year of fight against pandemic Covid19. Indian Pulp and Paper Industry has also faced a number of challenges due to Covid 19. Central Pulp and Paper Research Institute returned swiftly to its normal working from June 2020, after the lockdown period of March 24th to till 31st May 2020.
In the area of product development CPPRI has been consistently working and has successfully completed two different projects for production of fluff pulp from bamboo and production of high purity dissolving pulp from bamboo and whole jute. In addition to this consultancy was provided to a number of startups companies for utilization of cellulosic biomass for production of pulp for table wares or paper crockery.
Indian paper industry is one of the most fragmented sector with production capacity ranging from 5 TPD to 1650 TPD and geographically highly dispersed. During the decade 2010 to 2020 Indian Paper Industry registered a substantial growth which resulted in a two fold increase in production from 10.99 Million Tons (2010) to 21.36 Million Tons (2020).
This growth story of Indian Paper Industry has been hampered due to the pandemic situation. Every sector of the industry was forced to stop operations due to nation wise lockdown imposed after March 2020. Initially, Indian Paper Industry also shutdown the operation but after few weeks, paper sector was recognized as an essential service in many states and was allowed to operate with strict COVID Norms.
Upon resumption of operations, strong demand of pharmaceutical sector, FMCG sector, online shopping, and increase use of hygienic paper products etc., gave the momentum to the packaging segment. But, on the other side, due to closure of professional premises, academia, institutions, etc., the demand for writing and printing paper.
In the fourth Quarter of 2019-20 most of the well known paper units reported downfall in the turnover figures.
In FY 2020-21, mills were forced to close down on an average of 50 days and as a result most of the mills did not file performance report and are still doing compilation of turnover and production figures. In the mid of 2020, industry was facing immense shortage of raw material mainly because of logistics interruption, shortage of containers, labor issues, etc,. After June 2020, all units resumed their process with 60% to 70 % capacity utilization. However, due to ongoing demand of pharma and FMCG sector the packaging sector did not loose its pace and registered almost same production levels as that exhibited in 2018-19.
Strong demand of packaging grade paper provided support to the industry and therefore, 71% production share of market remained largely unaffected by the pandemic impact. Further, some green field as well as brown field projects also started their commercial production of packaging grade paper, which covered up the loss of production wiped out the loss of production figures of the writing and printing sector.
Today there are about 900 paper mills spread across the country. The total operating installed capacity in the sector is 23.99 million tons per annum and the production is 21.36 million tons per annum. Table -1, presents a snapshot of the Indian paper sector. Nationally, paper sector is one of the core entities in terms of providing employment in the Indian hinterland. Overall, 2.5 million persons are directly and indirectly getting their livelihood from this sector.
At the national level, this sector contributes Rs. 8000 Crores to the National exchequer with a turnover of Rs. 70000 Crores. Fueled by the National Priority of a knowledge-based economy, the sector is likely to emerge as a significant contributor to the Government's target of achieving an overall growth of 8% in manufacturing.
A STATISTICAL BACKGROUND NOTE ON INDIAN PAPER INDUSTRY:
The consumption of paper in India increased from 16.91 million tons in 2016-17 to 22.83 million tons in 2019-20. During this period India's paper consumption registered CAGR of 6% compared to the global growth of 3% making India one of the largest growing paper markets in the world. Relevant figures are placed in Table 2.
Paper industry has three broad categories of products i.e. Writing & Printing Paper, Packaging Grade paper (Kraft paper, duplex paper, board and paperboard) and Newsprint. Table 4 gives the category wise production figures. As can be seen, the newsprint sector continued to be affected by the low cost imports, thereby this sector clocks the production figure higher only to Tissue Paper segment. Further, all the production of Newsprint is coming from the waste paper based mills. Production of writing and printing paper gets contribution from the mills using all the three type of raw materials.
In spite of sufficient domestic capacity of packaging grades paper manufactures, imports under HS code 4804 & 4805 are taking place in India. Industry sources ascribe these imports to the zero to zero tariff regimens under various free trade agreements.
In 2020-21, steep hike can be seen as nationwide lockdown affected the local production and where for, to fulfill the domestic demand almost double imports were recorded in the month of April & May, 2020-21. But, as industry resumed its operations, dependency on the imported kraft paper reduced to pre-covid level.
If the numbers alone are considered, then Gujarat has the maximum paper making units. However, most of these units are recycle fibre based. The state of UP has the second largest number of paper mills. Most of these are in the Muzaffarnagar and Meerut clusters. Most of the major players are in Tamilnadu, Andhra Pradesh and Maharashtra. The major pulp and paper mills clusters are in and around Muzaffarnagar, Vapi, Muzaffarnagar, Kashipur, Coimbatore, and Ahmedabad.
Major achievements of CPPRI during 2020-21:
Production of Fluff Pulp from Jamaica Bamboo
Cellulosic fibre (pulp) is the raw material for a number of end products. One of them is hygiene products like adults and baby diapers and sanitary napkins. Conversion of cellulosic pulp for production of super absorbent fluff material to utilize in diapers and sanitary napkins is not only a substantial value addition but also an environment friendly solution too. Cellulosic pulp helps in reduction of synthetic super absorbent material used in these products. The process has two steps:
- Kraft pulping of bamboo and TCF bleaching of optimization of unbleached pulp.
- Hammering of TCF bleached bamboo pulp into fluff.
The fluff prepared from bleached kraft pulp of bamboo is comparable to the pulp available in market. The project has open the possibility to explore other long fibre raw materials like jute, banana etc to utilize in production of fluff pulp.
Production of Dissolving Grade pulp from Bamboo and whole jute
The fibrous raw material has not only one end use i.e. pulp and paper. Basically pulp is the cellulosic source of raw material for many other end products. Higher the purity of cellulose after pulping and bleaching, higher will be value addition which may turn into better economic viability.
Government of India aims to support the farmers, the growers of the crops like whole jute, bamboo.
National Jute Board has sponsored a project on production of high purity dissolving grade pulp from whole jute and bamboo. Whole jute has higher silica and initially it took numbers of experimental trial to remove silica from pulp in different process stages viz. pre-hydrolysis, pulping and bleaching. After sustained efforts we succeeded to produce bleached pulp with +94% alpha cellulose and all other characteristics in the desired accepted range dissolving grade pulp. The trial of conversion of pulp to viscose and to fibre was carried out successfully at Aditya Birla Science and Technology Co. Ltd., Mumbai, Maharashtra. Further work is in progress on feasibility and pre pilot scale trials.
The Indian paper sector has performed fairly well over the years even though it was confronted with factors internal to the sector as well as due to externalities. The sector has unutilized capacity primarily due to acute fiber shortage in the country. Another reason for low capacity utilization has been the ever-increasing input costs particularly for energy inputs (both coal and non-coal).
The sector is very capital intensive –the ROI in its case is five to seven years. This fact has been reflected over the decades that almost all capacity addition have occurred largely through brownfield expansions. Further, most of these expansions have been in the waste paper based segment and due to de-bottlenecking measures taken by individual units, as low investment options.
Even in the above scenario, the Indian paper sector has taken notable steps to maintain smooth operations and remain competitive to the maximum extent possible in the post globalization era. The work carried out in raw material augmentation and its utilization by the sector is very commendable. Nearly all wood-based paper mills have robust plantations programs in place wherein they can source the major volumes of the required raw material. The agro based segment has mastered the art of paper making from what are known as short fiber and inferior raw material. India is one of the few countries that produce writing/printing paper from bagasse and other agro residues.
Time is now ripe for the Industry to look beyond the medium term and invest in R&D for long term sustainability. There is an urgent need to invest the CSR funds into R&D which not only help the sector but also will impact the communities that are directly or indirectly involved with the paper sector.
There is a pressing need to ensure a sustained availability of quality lignocellulosic raw material for paper making in the country. In this reference the proposal for leasing of degraded forest lands for pulpwood plantations needs to be fast tracked by the Ministry of Environment, Forests and Climate Change (MoEF&CC). If the industry is assured of availability of quality raw material well into the future, it can plan investments and expansions with a long-term vision.
Also, urgent interventions are needed for revising the ITC-HS codes for paper (Chapter 48) at the eight-figure level in order to reflect the needs of the current trade of paper in India. This is needed to reduce the increasing imports of these items under the “Others” category. Also, certain varieties such as copier paper needs to be given a specific code under Chapter 48.
Energy is clearly the most important parameter that needs to be monitored after the raw material availability. The industry needs to shift to energy efficient technologies, but it needs funds for the same which are difficult to be available on commercial terms in view of the long ROI. Whereas the Bureau of Energy Efficiency has made some efforts to help the industry move towards energy efficiency under PAT -2 and the National Motor Replacement Program (NMRP) through its subsidiary, Energy Efficiency Services Ltd. ( (EESL), direct funding may have to be planned for inducting energy efficient unit operations in the pulp and paper sector.
Currently, the paper sector is moving towards an era of new opportunities driven by introduction of biorefinery approach and possible ban on Single Use Plastic. These opportunities will open new avenues for utilization of all possible unique products from the constituents of ligno-cellulosic raw materials produced in a biorefinery. This would have the potential to change the face of the Industry. The sector may well look into the future where pulp and paper would actually be the by-product of the biorefinery operations, and the other value-added eco-friendly products will become the main stream products contributing substantially to the bottom line.
Central Pulp & Paper Research Institute, a National level Institute was established in 1980 as an autonomous body under the administrative control of Department of Industrial Policy & Promotion, Ministry of Commerce and Industry, Govt. of India to promote R&D in the field of pulp & paper. The origin of CPPRI dates back to the year 1975 when the UNDP-GOI Project became operational. After the conclusion of the UNDP Project, the facilities thus created were utilized to fulfill the long felt need for R&D needs of Indian Pulp and Paper Industry. Thus after the approval of the Cabinet, Central Pulp & Paper Research Institute (CPPRI) came into existence in November 1980. Existing R&D facilities were continuously upgraded with the aid of Plan Funds received from the Government of India.
Sappi Limited announced today that it has concluded an agreement with AURELIUS Investment Lux One S.à.r.l. (“AURELIUS”) regarding the divesture of its Maastricht Mill in the Netherlands, its Stockstadt Mill in Germany and its Kirkniemi Mill in Finland (the “Transaction”).
Sappi Limited announced today that it has concluded an agreement with AURELIUS Investment Lux One S.à.r.l. (“AURELIUS”) regarding the divesture of its Maastricht Mill in the Netherlands, its Stockstadt Mill in Germany and its Kirkniemi Mill in Finland (the “Transaction”).
Steve Binnie, CEO of Sappi Limited commented: “We are very happy to have reached agreement with AURELIUS to take ownership of the three mills. Although they no longer fit in Sappi’s portfolio, they are strong assets with good people.
“The decision to sell these mills follows a detailed and thorough strategic review by Sappi in line with our group Thrive25 strategic focus. This includes reducing exposure to the graphic paper segment while expanding Sappi’s presence in segments including packaging and speciality papers, pulp and biomaterials. Recent investments across our South African, American and European operating businesses demonstrate this priority.”
Sappi received binding offers from several parties. Following due process, the board of Sappi agreed to proceed with the offer from AURELIUS, a pan-European multi-asset manager group. The sale will be subject to various standard suspensive conditions. The sale is expected to close in the first calendar quarter of 2023 once all these conditions have been fulfilled. A transitional services agreement will also be entered into to ensure a smooth transition of the businesses between the parties.
The enterprise value of the sale amounts to approximately €272 million. The consideration consists of cash proceeds and retained receivables (€212 million) as well as retained liabilities (€60 million). The proceeds will be used to reduce debt further and continue to increase Sappi’s focus on the identified growth segments. The net loss after tax attributable to the net assets of the three mills for the last twelve months ended 31 March 2022 was €6,5 million. Given the current volatile market conditions the EBITDA for the same period for the three mills was €58 million. As a comparison, the EBITDA for the pre-Covid period of twelve months to September 2019 for the three mills was €40 million.
Marco Eikelenboom, CEO of Sappi Europe explained: “Going forward Sappi’s focus in Europe as regards graphic paper will be on the stronger commercial print market. In addition, in the packaging and specialities segment, the European business will predominantly focus on the flexible packaging, functional papers, self-adhesives including glassine, labels as well as dye-sublimation categories. “We believe this sale will help unlock potential value at each mill which would be best pursued by a new owner.
Our strategic focus is on market segments not served by these mills.” “The market for pulp and paper products is of particular interest to AURELIUS considering our industrial sector expertise. We combine a proven track record in complex carve-outs with a deep understanding of how to identify and unlock value creation potential. Given these key traits, this transaction offers ample opportunity to unleash the full potential of these production sites”, states Dr. Dirk Markus, Founding Partner of AURELIUS.
The mills included in the sale: Sappi Maastricht Mill produces 260,000 ton per annum (tpa) of coated woodfree paper and paperboard mainly sold to printers and packaging converters globally Sappi Stockstadt Mill is an integrated pulp and paper mill located in Germany, producing 145,000 tpa of pulp which is used to produce 220,000 tpa of coated and uncoated woodfree paper mainly sold into the European print market. Sappi Kirkniemi Mill is an integrated pulp and paper mill located in Finland, producing 300,000 tpa of bleached mechanical pulp which is used to produce approximately 750 000 tpa of a variety of coated mechanical paper grades used in the print publication industry globally.
A global leader in dissolving pulp and paper-based solutions, Sappi Limited is headquartered in Johannesburg, South Africa; has over 12,000 employees; manufacturing facilities on three continents, in ten countries (ten operations in Europe, four operations in North America and five operations in South Africa) and customers in over 150 countries worldwide Sappi works closely with customers to provide relevant and sustainable dissolving pulp, paper (speciality, packaging and graphic), paper pulp, and biomaterial products and related services and innovations. Our market-leading range of paper products includes: flexible packaging, label, release liner, containerboard, graphic papers, casting release papers and in our Southern African region newsprint, uncoated graphic and business papers. These products serve the fashion, FMCG and industrial sectors.
Our dissolving pulp products are used worldwide by converters to produce viscose fibre, pharmaceutical products as well as a wide range of household and consumer products. Sappi drives product innovation and the development of new uses for its renewable resource (woodfibre) as well as for the biomass and other residues from its production processes. One such area is in the field of biomaterials (cellulose composites, nanocellulose and lignins), biochemicals including hemi-cellulose sugars and bio-energy forest products materials which Sappi believes will play a key role in its future range of products, both as commercial products and for applications within Sappi. We continue to grow into a profitable and cash-generative diversified business with an exciting future in woodfibre, a renewable resource. www.sappi.com
About AURELIUS Group
AURELIUS is a pan-European alternative investment firm. Deep operational expertise and experience enable AURELIUS to accelerate value creation within its portfolio companies. The Group has offices in London, Luxembourg, Munich, Amsterdam, Stockholm, Madrid, Milan, and Dusseldorf.
“Surging exports of paper will most certainly keep the domestic prices quite high”: Mr. A. Annamalai, Director – RFC
- Many Paper mills seem to have accepted fairly large orders from overseas markets.
- Domestic regulations are good enough to prevent any unfair practices by the big players.
June 2022 | The Pulp and Paper Times:
Recently, The Pulp and Paper Times got the opportunity to interact with Mr. A. Venkat Annamalai, Director- Rose flower Company Papers P Ltd and past president of Federation of Paper Traders’ Associations of India ( FPTA), over various issues related to paper trade, Import, Export, and growth of Indian paper industry. Here is his full interview:
Q: Please give us a brief introduction of Jeyam & Company and Rose Flower Company Papers Pvt Ltd (RFC)
Jeyam & Company is a 77-year-old family-held firm and we are the third generation in this business. We are one of the oldest Paper trading company in Tamil Nadu.
Our Associate Company “Rose Flower Company Papers P Ltd.,” was incorporated about 45 years ago for the purpose of exclusively handling the business of the Products manufactured by ITC Ltd., (Paperboard and Specialty Papers Division). We have been associated with ITC (PSPD) right from its inception as their Whole Sale Dealer.
Q: Being a past president of FPTA and active in Paper Trade for last four decades, what is your quick review of the present paper trade market scenario? About demand and supply dynamics of various grades of paper especially Coated, duplex, Newsprint, and Kraft paper segment.
I guess the current scenario is one of a kind which I have not experienced ever since I joined business ! I have heard from much more experienced elders that they have not experienced such a situation in their experience as well! We have witnessed an upswing of prices ranging from 30% to 70%. This ub normal sharp spike in prices was coupled with acute shortfall in supplies to the domestic markets due to the prior commitments made by the Industry to the Government sector as well as exports.
Demand and supply dynamics:
- Coated: prices have more or less stabilized after an upswing of about 30%. The prices are likely to be stable at the current levels for the near future. Though the sea freight has reduced substantially, the prices are remaining firm due to the increase in the pulp prices and lower than normal arrivals. The demand is expected to be stable.
- Duplex/Kraft: with improvement in the availability of recycled fibers, these grades have witnessed a fall in prices. The demand too seems to be subdued.
- Virgin Grades: the Market for virgin grade boards seems to be steadily growing with more and more segments preferring these grades of boards. The prices have also been firm and are likely to be firm in the near future.
- Newsprint: After witnessing a steep increase in price peaking at about 75000 per ton, Newsprint prices have softened by about 15% recently. However, the demand seems to be stable at the revised prices.
The current situation is unique in the following aspects:
- There has been a spurt in prices in the last 60 to 75 days. The increase ranges anywhere between 30% to about 70% depending on the product. The probable reasons being:
- The offtake from all convertors engaged in servicing the requirements of the educational sector had been sluggish upto March 22. Normally the publishers commence their sourcing activities during the month of October where as the note book convertors commence their sourcing from January. For the current season, the convertors were unable to predict the demand (due to the fear of Covid striking again) as a result of which the orders were not flowing upto February after which there was surge of orders from March, once there seemed to be some clarity on the normal functioning of the Education sector.
- Not withstanding the sourcing by the various Text Book Corporations who normally source paper as early as December/January also got delayed their sourcing activities due to the same reasons mentioned above. All this delay has led to steep increase in the demand of W & P grades of paper since March 22.
- Due to increased overseas demand for paper from India (at much better prices) many Paper mills seem to have accepted fairly large orders from the overseas markets.
- Poor arrivals of imported of both coated and uncoated grades due to multiple reasons like higher prices, higher ocean freight, longer lead times have also been a reason for the spurt in prices.
- The robust demand for all packaging grades of paperboards due to increased economic activities post-COVID-19 has also been a factor in the prices firming up in the recent past.
Q: Paper & paperboard exports from India hit an all-time high of Rs 13,963 crore in FY21-22, up nearly 80% year-on-year, What factors do you see working behind these jumps in export?
1. Bullish trend in Pulp prices.
2. The demand for paper and paperboards are witnessing an upswing due to the waning effects of COVID and the consequent opening of the economy
3. China has been in the backfoot due to the impact of COVID.
Q: Do you think excessive export of paper is good for the domestic market? Don’t you think that export opportunities will create price pressure in the domestic market?
Exports at the cost of domestic market is not a good sign for the domestic convertor/consumer/trader. However, we understand that most of the Paper mills have increased their share of exports. If the current international trend continues, exports will continue to surge which will most certainly keep the domestic prices quite high.
Q: Russia –Ukraine War has increased the prices of imported newsprint up to 80 percent. This is paving a way for local manufacturers to revive their newsprint production. How do you see this situation?
True. Looks like the war will be a long drawn affair! Prices of newsprint have closed to doubled and many paper mills have shifted a substantial volume to Newsprint due to better realization and benefits of economies of scale while producing newsprint. Though prices of domestic Newsprint have softened and may witness further softening in the future, the demand is likely to be stable.
Q: Govt. of India has brought the Import of Paper under Paper Import Monitoring System (PIMS) from 1st October. This order shall be applicable to a range of paper products, such as newsprint, handmade paper, wallpaper base, duplicating paper, coated paper, uncoated paper, and other grades of paper. Do you think this step will bring relief to domestic manufacturers? What is Government's intention behind PIMS?
There seem to be more negatives than positives in PIMS!
- Additional paper work
- Possible harassment by Government departments.
- Infringement into free trade by genuine Traders.
- Un-necessary compliances.
- Government will have a tab on dumping of goods into India
- Unscrupulous trading activities will be restricted.
Q: Do you think that regulating the paper import may lead to market monopoly by some big paper manufacturers in the future?
No. Personally, I do not think this regulation will in any way enable large domestic manufacturers to have a monopoly. I am quite confident that the domestic regulations are good enough to prevent any unfair practices by the big players.
Q: The surge in the price of waste paper domestically is making the price of a finished paper uptick. How you do overall analyze the waste paper crisis in India? What should be the paper mill strategy in procuring the waste paper from abroad?
We have been speaking on this for quite some time. The percentage of waste paper which comes back for recycling in India is one of the lowest in the world. There is a lot which the industry can do in this regard. The industry incentivizes local bodies/NGOs to collect waste paper and reward them suitably. May be they can use the CSR funds for this purpose by which not only the community is benefitted, the industry will also stand to gain.
This apart the association of recycled mills should conduct a sustained campaign and educate the common man on the importance of ensuring waste paper comes back for recycling. They should also have a robust collection mechanism. If possible, a national recycling policy, similar to the Extended Producer responsibility implemented for plastics/e-waste to be implemented for paper as well. The producers and the government to work hand in hand to frame simple but effective laws on disposal/collection of waste paper.
It may seem a difficult task, but with the co operation of all the paper mills, local bodies, NGO, and the Government we can achieve what we desire.
Q: RFC deals in various Specialty Paper and board grades along with packaging grades, how is market growth for these grades in the coming six months, especially when Govt. is committed to banning single-use plastic from 1st July 2022?
The demand for Packaging and Speciality grades are quite robust and is likely to stay there for a long time to come.
The new central regulation on usage of single use plastic products which is likely to come in force from 1st July 2022 is likely to be a game changer. Though many states have their own legislation in this regard, there seems to be a lot of disparity between the laws of various states and there seems to be very poor implementation of these laws. With the central regulation, we are expecting more clarity and uniformity. This coupled with strict implementation will most certainly open up new avenues for consumption of paper/paperboards. In this aspect, the Paper industry is likely to face stiff competition from other substrates such as cotton, jute, glass etc., The industry should work overtime at an extremely fast pace to improvise paper in such a manner that we are able to produce relevant and practical variants that will be the best substitutes for the single use plastic products that are likely to be banned.
Q: Any message for the paper industry
Paper is and will always be a Sunrise industry. The demand will continue to increase, only that the nature of usage will keep changing continuously. The industry should be fast in adapting to the changing needs and the traders should also vigilant and align themselves with the changing trends.
USE PAPER – IT IS BIO DEGRADABLE, SUSTAINABLE AND BIO DEGRADABLE.
PAPER IS THE PRODUCT OF THE FUTURE
Waste Shipment Regulation: It's not a ban, but it could potentially become a trade obstacle
-Paper mills have to give a proof of a broadly equivalent standard to the recycling process in Europe
-You’re (Paper Mill) looking for a sustainable supply and we as Europeans are looking for sustainable outlet
Recently, The Pulp and Paper Times interacts exclusively with Mr. Andreas Otto, VP- European Recycling Industries' Confederation during his visit to India. Mr. Otto spoke about various issues related to recovered paper export to India, the Proposed Ban of EU, and other burning issues. Here is his full Interview:
Q: Ban on the export of OCC has been lifted by the European Union, what trend do you see in price of OCC in the coming time?
Well from the Europe point of view you always have to benefit various factors. We are seeing huge demand, be it in Europe, be it in overseas. India is the major overseas market for Europe. The main factor from my perspective is the logistic costs. The ocean freight market is still disrupted, and now we are seeing freight rates from Europe into India which are three times of what used to be prior to Corona times. Of course, it will hardly be back to where it was but once the freight rates are dropping, once the ocean freight market is getting back to what I would consider a “newnormal” the OCC prices should drop accordingly. There's already light at the end of the tunnel. The question is just how long the tunnel is and if I should make an educated guess, very difficult to guess in these times, I would see a drop maybe by end of this year latest beginning of next year.
Q: The President of the World Packaging Organization has said that plastic bag has seven times less environmental impact compared to paper because paper making involved energy-intensive resources, what do you think about his claim?
Well, we have the overall trend worldwide that plastic bags are being replaced by paper bags. Let me put it this way from the paper perspective, I do appreciate the trend, of course. On the one hand side, you're right the energy costs are much higher for the production of paper versus plastic. On the other hand, if you have an outlook to what happens to plastic vs. what happens to paper from an environmental sound manner? May be paper is the better solution.
Q: How do you compare the recovered paper collection rate of India with European recycling industry?
if I'm right, the collection rate over all Europe, the average rate is like 55%, If I'm correct, in Germany it's even up to 80% and versus India where it is just above 30%. We have a different system in Europe as you're having in India. Of course, from the environmental point of view it is visual but also the collection rate in India is increasing. We have seen over the last years a high increase on the imports of recovered paper. I think in 2021 It was like 8.5 million tons. Of course, one of the reasons is that you're having a flourishing paper industry, which is very good. Congratulations for that. On the other hand, the collection rate remains on a relatively low level and of course, from an environmental point of view it is wishful that the collection rate could be any higher. So maybe the system needs to be adjusted somehow.
Q: The EU Commission has issued the proposal for the new legislation on the export of waste (Proposal for a regulation by the European Parliament and the Council on shipments of waste), which will also rule the exports of recovered paper. This will mean that European paper mills will have access to unlimited supplies of very cheap recovered Paper. How will this regulation be going to affect the paper mills?
The European Union is revising the Waste Shipment Regulation under the so called “EU Green Deal”. The European Commission has published a draft revised regulation last November but the legislative process is still ongoing and may be finalised in the course of next year. Additionally, there will be a transition period which takes about another three years. So maybe by 2026 you will see the implementation of that new regulation. It's not a ban we are talking about, but it could potentially become a trade obstacle. What will come is what is being called a “broadly equivalent standard”, which means that countries overseas where recovered paper is being shipped to plus the paper mill itself have to give a proof of a broadly equivalent standard to the recycling process in Europe. There will be some kind of an audit to prove that but we just don't know how the audit process will exactly look like. The devil is in the detail and no one can tell how difficult the audit process will be as per today. If you compare it with the UK’s packaging recovery notes (PRNs) system, for instance, it will not be that easy, but maybe at the end of the day it's just another certificate like ISO what the paper mills need to get.
As everyone is concerned about that I would simply suggest that actually the Indian Associations is keeping an eye on that issue and please keep in mind that you're having friends in Europe, which is like the Association I'm representing, which is ERPA, the recovered paper branch of EuRIC, and I strongly suggest keeping close contact to make sure that we all on the same page. And once there's anything new, we are glad to inform the Indian associations accordingly.
Q: Indian Paper industry is highly dependent on the European OCC material, how does ERPA ensure the long-term sustainability in the supply of the OCC to the Indian contingent?
India has turned into the major overseas market for the export of recovered paper. In Europe we do have a generation of 56 million tons of recovered paper per annum overall. Out of that, 8 million tons are being exported of which two to three million tons are being exported into India nowadays. It's a market at the end of the day and the overseas market must compete with the domestic markets in Europe. At the same time, you have to keep in mind that recovered paper is something which is difficult to store for a longer period of time. So, on the one hand side, we are having the surplus and even though new capacity is coming up in Europe, still being estimated five, maybe 6 million tons will still be exported. Therefore, Europe needs a good sustainable outlet overseas. So, you're looking for a sustainable supply and we as Europeans are looking for sustainable outlet. And since the paper industry in India is as I said, flourishing and new capacities coming up, we're looking forward in a long-term sustainable supply. And we have been long-term partners already, I remember that the first time I attended the Paperex was back in 2002 when other markets were not even in the picture. Long story short I’m very optimistic since there will be a surplus of recovered paper in Europe seeking for a reliable and sustainable outlet which is India from my point of view.
Q: There is a 6% to 7% growth per annum in the Indian Paper industry, where do you see the Indian Paper industry in next ten years?
I would say that looking to India, I'm having like more than I don't know 400 paper Mills in mind which is more than impressive. India relies a lot on the domestic market, but I think to keep this growth continuously, it's important that Indian finished paper is more exported in large volumes. So taking the6% to 7% growth per annum, I do see this increase over the next five years and don't get me wrong, but to make an estimate for more than five years, it´s a little bit difficult.
Q: There is a thought of us, that can all the paper mills form a collegiums / or induct a central nodal agency who will actually buy the imported OCC on behalf of paper mills with negotiable or at lower price?
A: It is a very smart question. Let me put it this way, the idea behind your question is to get a better grip on the market for the sake of sustainability and price. First, you need to consider that we have different market pattern in the domestic European market. It is more based on long-term contracts, whereas in the overseas market, India, Southeast Asia…, is more like a spot market in the sense that material is committed monthly. It is generally in the interest of the European vendors to have long-term contracts rather than short-term contracts, be it one year, half year, be it three months. European contracts are based on fixed prices or linked to an index. In addition, when it comes to overseas trade you must balance various volatile factors such as the ocean freight market, exchange rate € against US$ etc. which also needs to be fixed for the validity of the long-term contracts. If there's some willingness at the Indian paper mills side, I would also suggest that you may think of long-term contracts with European vendors maybe in addition to short-term contracts in the first place. Maybe this is the key for a sustainable supply in future.
Q: Any message for the Indian Paper industry?
Future Sustainable Supply Key: Think of a long term contract for 3 months or 6 months. I'm glad to be here. I wish you all the luck since we're on the same boat here so the better the Indian paper industry is doing the better for us so I'm looking into a bright future. Thanks for being here. Thank you.
Single Use Plastic ban spikes the price of paper, INR 15 per kg hike in last three months
Kuantum Paper to reach revenue potential of Rs 1100 Cr by year-end: Mr Pavan Khaitan
The paper industry witnessed a price rise of around Rs15 per kg in the last three months. We are looking at our margins reaching close to 30% from the current 22% by the end of the year. We are at full capacity utilization and forecasting revenue potential to reach Rs 1100 Crores by the year-end.
13 September 2022 | The Pulp and Paper Times:
The tailwinds and increased paper demand have propelled the paper stocks anywhere between 100 – 200% in the past year. The question is, how long will it sustain? And what is the future of these stocks? Mr. Pavan Khaitan, Vice-Chairman and Managing Director, Kuantam Paper, shared his insights with CNBC- TV18 on the demand and value outlook for the paper industry.
Speaking about the tailwinds that the paper industry is facing, Mr. Jiten Parmar, Co-Founder of Aurum Capital, shared, “In my opinion, the sector is doing well, and with the help of tailwinds, the sector will continue to perform well for another few months. With the increase in per capita income, paper usage in India will grow. Also, with imports restricted, this sector would perform well for at least two more quarters.”
Echoing the words, Mr. Khaitan, when asked to quantify the realization and share the price increase in the last two quarters, he added, “The prices of paper has increased quite dramatically in the current quarter when compared to the first. We have noticed a quite anti-gravity-defying kind of price rise from July onwards. The paper price rose by almost Rs5-8 per kg in July, followed by Rs 4-5 in August. In September, so far, it has risen by Rs5. One of the major reasons for the price rise is the ban on single-use plastic, which has posed a huge opportunity for the paper industry to tap. Paper is the clear front-runner to replace all types of plastic packaging applications.”
He said that the paper industry witnessed a price rise of around Rs15 per kg in the last three months, and their realizations are comparatively better than their peer set because of market orientation. He opined, “Most of our products go to the printers, publishers, and other wide applications. We are also into special papers which cater to higher price margins. Our net realization would be around Rs 95,000 per ton.”
While sharing information about Kauntam Paper’s overall revenue mix and source of raw materials, he added, “Around 15% of the mix comes from the specialty segment. As we are in the R&D stage, we do not cater much to single-use plastic replacement. We source our raw materials locally, and all the suppliers are within 100 km of our mill. We have developed long-term relationships with our suppliers. One particular raw material we use is Sarkanda grass, which grows abundantly in the government forested areas.”
Talking about the cost-saving measures that Kauntam Papers have taken, he added, “Our backward integration project was installed and commissioned in March 2021, and it is giving us benefits in terms of reducing chemical, power, steam costs, and replacing the imported wood pulping by our wood pulping in particular. It has benefitted us quite substantially. We are looking at our margins reaching close to 30% from the current 22% by the end of the year. We are at full capacity utilization and forecasting revenue potential to reach Rs 1100 Crores by the year-end.”
--Excerpts from CNBC-TV18
A new paper mill in Assam to meet packaging demands, strategically located near upcoming Multi Modal Logistics Park
Goalpara | 7th April 2022 | The Pulp and Paper Times:
The evolution of the packaging industry across India acts as one of the major factors driving the growth of kraft paper market. The increase in demand for sustainable and recyclable material from packaging and various other end-use industries, and advancements in packaging and wrapping applications accelerate the market growth.
“The rise in demand for more environment friendly and effective packaging materials and solutions from end-use industries such as foods & beverage, building and construction, automotive, pharmaceuticals, cosmetics & personal care, aerospace, and electronics, and rise in consciousness regarding environment among population further influence the market. Additionally, change in consumer preference, increase in incidences of pollution, rapid urbanization, growth in awareness, breakthrough in new technologies and high disposable income positively affect the kraft paper market,” said Mr. Ajay Agarwal, Director of new paper mill Purbanchal Paper Mill LLP (PPM).
The new paper mill is situated at Industrial Growth Centre, Matia, Dist. Goalpara, Assam. “We are feeling very proud to be associated with Indian Paper Industry. We are setting up a state-of-the-art infrastructure for producing 150 TPD kraft paper with a approx total outlay of INR 70 to 80 Cr. (including working capital). This quality paper will be suitable for the manufacturing of corrugated boxes and other packaging applications” Mr. Ajay Agarwal exclusively informed to The Pulp and Paper Times.
Purbanchal Paper Mill LLP is Promoted by Ajay Agarwal Founder & MD, Nipco Group (India) & M/s M.P Agarwal Group, Bokakhat.
Mr. Agarwal further says that North East region is developing fast for corrugated packaging also, and Goalpara is very strategic location to cater the demand of local corrugators and as well as export gateway to Bangladesh, Bhutan and other nearby countries. “Our new mill just 30 KM far away from upcoming Multi Modal Logistics Park, Jogighopa & close to the international borders of Bhutan and Bangladesh which will provide an opportunity to export to these two neighboring country markets in future” he said.
PPM will focus more on the domestic corrugation market to sell its paper. It will manufacture paper between 16 to 24 BF under 80 to 200 GSM range.
“Our civil construction has been completed and the erection of machine is in full swing. We are expected to start the commercial production by July 2022,”
“The new paper mill would have Paper Machinery supplied by DS Engineers & Pulp Mill By Parason Machinery, Rolls, Boiler, and ETP from Ashoka Rolls, Cheema Boilers Ltd., and Chemical Kraft, respectively” Mr. Agarwal informed.
PPM will have a 4.1 m deckle machine with 3850 mm as a finished paper deckle.
On the question of future expansion, Mr. Agarwal says, we have already acquired extra land for our Phase- 2 Expansion Plan & Our Plant is designed in such a way that In Phase 2 we will expand our Capacity from 150 Ton to 225 Ton in the same plant & set up integrated Captive 4 MW Power Project.
PPM is contemplating to make high BF paper in phase -2 expansions on the same machine after some modifications. The purchase of waste paper will start after 15th May 2022
Mr. Agarwal also reveals that in Guwahati, we have already two corrugation units belong to our sister concerns which lead us for in-house consumption of paper. Apart to that, we have also planned to set up a 1000 tonnes automatic corrugation unit at the same location in Industrial Growth Centre within a year. We have already acquired extra land for this purpose.
400 crore capex plan: Andhra Paper to re-build & upgrade pulp plants
29th August 2022 | East Godavari District, Andhra Pradesh | The Pulp and Paper Times:
One of the largest integrated paper and pulp manufacturers in India- Andhra Paper Limited (APL) has approved the INR 400 Capital expenditure plan to improve the efficiency of the pulp mill.
In a regulatory filing, the company said, we wish to inform that the Board of Directors have on August 26, 2022 approved a capital expenditure amounting to INR 400 Crores to re-build and upgrade the existing Pulp plant to improve the reliability and efficiency of the Pulp Mill. This will help sustain the current levels of production, improve efficiency in Pulp Mill processes and lend flexibility in operations, augment pulp production capacity from existing 550 Tonnes per day to 600 Tonnes per day. The expected completion timeline is November 30, 2023. The proposal shall be funded through mix of debt and internal accruals.
Andhra Paper manufacture writing, printing, and cut-size papers for both local and international markets, and offers a comprehensive range of high-quality speciality grade materials for a variety of uses. The papers are created with elemental chlorine free (ECF) pulp technology and come in the best-in-class brightness. APL understand our responsibility towards the environment and invest in sustainable business growth and innovate products that enable us to reduce not only ours but also our customers’ environmental footprints.
Out of the total capex of INR 400 crores, an estimated amount of INR 113 crores shall be towards equipment reliability & sustainability of the current levels of production. The balance amount of INR 287 Crores shall be towards upgradation of Pulp Mill.
APL revenue from operations stood at INR 1,38,023 lakhs in FY22 as compared to INR 88,675 lakhs in FY21, registering a robust growth of 56%. It registered an EBITDA of INR 26,581 lakhs with a strengthened margin of 19% as against H7,170 lakhs with a margin of 8% in FY21. APL profit after tax for the year stood at INR 13,973 lakhs as against loss of INR 460 lakhs in the previous year.
Single-Use Plastic Ban: Everything, at each level, alternative for plastic will be expected from paper
-Packaging contributes to almost 50 % of plastic waste generation, and 77 % of that is single-use plastic.
-Single-use plastic ban has opened up the requirement for Kraft paper, Sack Kraft Papers, Maliptho, MG poster, coated and uncoated paperboards, greaseproof and glassine paper, etc
- The food packaging business is seeing an upward trend of around 500 billion dollars in the coming five years
24th July 2022 | The Pulp and Paper Times:
The Federation of Paper Traders Association (FPTA), India, organized a webinar discussing the opportunity that has arisen for the paper and paperboard manufacturers due to the ban imposed by the Government of India on single-use plastic items.
Mr. Deepak Mittal, President of FPTA, said, "The transformation from plastic to paper is an opportunity for Paper boards and molded fiber products. The association believes the shift from plastic to paper could be the next mega trend in the next decade. It could propel the current growth rates from 6-7% to double digits. This step will make India one of the fastest growing paper markets in the world."
He added, "It is noticeable that the city's drainage system has already clogged with single-use plastics. Also, the rivers are overflowing with plastic waste, and the seas and oceans are washing ashore. Over the years, the environmental damage has increased manifold with the increasing usage of single-use plastic items. In line with that, our honorable Prime Minister, Mr. Narendra Modi, imposed a ban on single-use plastic from July 1, 2022. The Ministry of Forest and Environment Climate Change notified on August 12, 2021, the plastic waste management amendment rules 2021 for it to become law from July 1, 2022."
"The adverse impact of littered single-use plastic on our ecosystem has been globally recognized. It has become a challenge for all the countries across the globe. With the efforts of the people and stakeholders, the ban will succeed. Banning plastic is one thing, but being in the paperboard business is another, and it creates an opportunity for all to make a change," Mittal added.
Mr. Ved Krishna, Strategy head of Yash Pakka, shared his insights over the ban and how Yash packaging and Yash Pakka are creating a difference in making the new paper for the food industry. He said, "All this comes to scaling the food packaging industry." He and his company have a dream that goes way beyond the idea of a plastic ban.
"The idea is to leave a cleaner planet for future generations. To achieve that, the idea for us, as an organization, is to provide regenerative and sustainable packaging. Our company focuses on the goal to achieve sustainable packaging and give back more than we take to nature. Packaging contributes to almost 50 % of plastic waste generation, and 77 % of that is single-use plastic. On average, the life of single-use plastic is 12 minutes, which means it is used only for 12 minutes. The food packaging business is seeing an upward trend of around 500 billion dollars in the coming five years. We, currently, are focusing on three types of food packaging Compostable paper-based flexible material, Compostable mineral-based pellets for carrying the food, and food serviced Compostable molded pulp-based materials."
Mr. P.N Shreedhar, DGM, Sustainable Products and Packaging, ITC-PSPD, shared how the plastic ban will impact the industry in the next couple of years. "Plastic waste processing is emerging as a big business opportunity. The road map for all manufacturers for the next five years is to incorporate a certain quantum of recycled plastics into production. The government is planning to give environmental compensation or recycling certificates. On the other hand, the manufacturer will also be penalized if they fail to manage the plastic they put out on the market," he added.
"We have started working as far as paperboards are concerned on a certain application, where we have removed the LDPE. The plastic ban will impact more or less everyone in society as they move forward. Everything, at each level, alternative for plastic will be expected from paper. Already there is a jump in the manufacturing of paper, sticks, straws, cups, and bags, and we will witness many alternatives for secondary packaging. We will see traders turning into MSME converters for emerging paper-based applications in the future," he opined.
Dr. Ashok Kumar, Executive Director, Pudumjee Paper Products Ltd., spoke about the opportunities the ban will create. He shared that the idea to ban single-use plastic was discussed since 2010 but got delayed for some reason or other. There will be National and state-level control room setup to ensure effective enforcement. The government is taking measures and initiatives to eliminate and create awareness towards reducing the use of single-use plastic by bringing together entrepreneurs and start-ups with the industrialists, State, and Local governments.
"I think there is an opportunity for paper and paperboard manufacturers as the single-use plastic ban has opened up the requirement for Kraft paper, Sack Kraft Papers, Maliptho, MG poster, coated and uncoated paperboards, greaseproof and glassine paper, etc. All paper mills have an opportunity to take advantage of this single-use plastic ban, but we have to remember that we have to manufacture suitable quality paper."
"The research and development of these new products need tremendous efforts. There is a need for close interaction with paper converters/paper dealers to develop solutions to replace plastic. It is the responsibility of the manufacturer or traders to provide the right quality of paper for different applications. Paper manufacturers/traders/converters must get together and put in their best efforts to develop products. Some solutions are already available, but we need to develop the remaining," he shared.
He added, "There is an opportunity for paper traders as the market will evolve and grow more than we can imagine. Paper traders will have to put in a lot of effort to stay aware of all the new regulations and certifications."
FACT & FIGURE:
-Global Plastic Waste Production: Approximately 400 million metric tons
-Approximately 36 % of all plastics produced; are used for packaging of Which 85% ends up in landfill or as unregulated waste.
-Total Plastic Demand in India for the financial year 19-20 was 16 million metric tonnes.
-Plastic waste generation in India reached around 3.4 million metric tonnes in 2019-20.
-As per CPCB's 2015 report, India has produced 25940 metric tons of plastic waste per day, of which 60% is recycled, and the rest 40% is disposed of.
-Around 1000 trucks per day are needed to transfer this waste which clogs drains, rivers, and seas.
A New Paper Mill in Absorbent, High BF and sack Kraft Paper segment
Kheda | 6th April 2022 | The Pulp and Paper Times:
Paper Industry is a core industry that plays a vital role in the economic growth of our country. The industry is expected to grow in the range of 12-15% in the coming year due to increased economic activities. Infrastructure spending and rural growth being the focus areas of this budget — all industries like FMCG, pharma, health and hygiene are expected to grow significantly.
“More than 75% of the paper industry producing packaging paper and board is also expected to witness a high growth opportunity. Consumer awareness concerning eco-friendliness, sustainability, replacement of plastic, rise of e-commerce and growth in retail are again big boosters for the demand of packaging paper and paper board.” said Mr. Anand Agarwal, Director at Shree Rudra Lamkraft Pvt. Ltd. a newly established paper mill in Gujarat.
Situated at Kheda district in Gujarat, Shree Rudra Lamkraft is all set to take a trial production in February 2022, “Yes, We have invested around INR 40 to 50 Cr in setting up a 150 TPD state-of-art infrastructure for the production of various grade of paper on a single machine. Currently, we are undergoing the trials and go for commercial production from April end,” Mr. Agarwal informed.
Mr. Agarwal further added that, “We are driven by an ambient passion to contribute towards a better world with the manufacturing of multi grades of paper comprising Absorbent, High BF and sack Kraft Paper that is renewable by design. We strive to represent new methods and ideas to efficiently reduce our environmental footprints and deliver exceptional paper products. Our endeavors are also focused on making a difference to lives.
Shree Rudra Lamkraft will manufacture all three grade of paper under 60 to 200 GSM range with maximum BF between 22 and 24. “Our deckle is one the largest in paper industry which is 4 meters finished.” He said.
The new paper mill will have mix combination of India and China Machinery, it has bought headbox, suction press, suction couch, dryers, wire part system from China and Pulp mill section has been installed by Parason Machinery. “We have engaged D.M. Engineers for machine supplying and framing activity” he informed.
New Paper will have ETP from Ishan Paryavaran Pvt ltd.
Mr. Agarwal unfolds his production plan says, “Initially, we will start producing absorbent kraft paper as we have robust knowledge of laminate market. Our few directors are already working in lamination industry and we hope to consume our 20 percent production in-house and rest will go to open market”
“We are also floating with good inquiries of sack kraft paper, and if we able to receive order of 400 tonnes paper in a month, we can reel out sack kraft also” He added.
Moreover, rise in the growth of the E-commerce and retail sectors and increase in the product premiumization will further create new opportunities for the sack kraft paper market. A steady rise in demand in the construction industry, owing to infrastructure projects, has also contributed to the increase in the use of sack kraft paper.
New paper mill has designed the machine in a way that it can produce quality paper from first day, “we have also installed size press which will enable us to manufacture High BF paper, we invested in best technology to provide quality paper for our buyers”he said.
He further explained that the growth of the absorbent kraft paper market is primarily driven by the increasing application of decorative laminates in the construction industry. In addition, the low maintenance and installation costs of decorative laminates are also expected to fuel the market growth. Furthermore, the technological advancements in printing techniques and manufacturing environmentally-friendly laminates are likely to offer immense growth opportunities for the market players. However, the volatile raw materials prices are expected to hamper the growth of the global decorative laminates market in the coming years.
Bashundhara Paper has planning to incorporate new machineries; Reports 43 percent growth in Net profit in FY 20-21
- During the year the BPML confirmed 8.63% revenue growth comparing to previous year and its exporting destination stood in 50nos.
Dhaka | January 2021 | The Pulp and Paper Times:
Having positioned in a fast-growing market set, Bashundhara Paper Mills Ltd. (BPML) has been relentless over two decades to offer its diversified products ranging from different types of Paper, Tissue & Hygiene portfolio, thereby it has rightly been entrusted from customers’ fraternity of home and abroad. Despite the pandemic restriction, BPML has managed to secure its growth path by registering 43 percent growth in net profit after tax for the year ended on 30th June 2021.
“Standing with an unpredictable hard wind of global pandemic Covid-19 situation for last two financial years, your company engaged all its efforts to overcome the global challenges. This unpredicted public health crisis soon morphed in to an economic upheaval, as governments enforced stringent lockdowns the world over to contain the spread of the virulence. Such shutdowns crimped trade and commerce mostly severely in the year 2021 and resulted in major global economic declaration. In spite of such limitation of global activities the company has taken it’s an opportunity to improve its business strategy, risk and crisis management to sustain in the global race.” Said Mr. Ahmed Akbar Sobhan, Chairman – BPML in the Annual report for FY 20-21
At present, Bashundhara Paper is the trusted source of volume Paper-needs of both Government level and, while keep general consumers pace of exporting to over 50 different global destinations.
With the theme of this report Retention to Success, the Bashundhara Paper Mills Limited has come in to fourth year in the capital market of Bangladesh. The company takes the pride of its 28 years’ glorious track-record.
As the leading industry in the Bangladesh, BPML has designed a business model for sustainable growth and continues to develop its presence in the markets, particularly in the paper, tissue and allied products. In its paper and tissue and allied businesses, the company sees a huge opportunity to develop by leveraging the competencies in both mature and emerging markets. Sustainable development is integral to the success of the business and its ability to create value.
Mr. Ahmed Akbar Sobhan further stated that, at the same time, the team paying its highest attention to develop the quality of products with an affordable price for all segments of our customers even this global pandemic and introduced some new product for the customers. During the year the company confirmed 8.63% revenue growth comparing to previous year and its exporting destination stood in 50nos. destinations around the world. It takes as the responsibility to engage itself to ensure the strategic planning in alignment with the customer’s needs and demand in competitive market so that, can possible to ensure the return on investment to the shareholders and achieve the ultimate organizational goal.
Mr. Safwan Sobhan, Managing Director – BPML said, “Despite the affected by the global pandemic the production capacity of BPML has increased around 8% than previous year, and we ensured the quality of products considering the demand. The Bangladesh economy managed to experience a moderate 5.47% GDP growth in FY 2020-2021 while the BPML has contributed an industry highest BDT 1,069.98 million to the national exchequer during the year under review.”
Disclosing BPML’s future course of action, Mr. Ahmed informed the shareholders that BPML has planning to incorporate new machineries for its production, which expecting the product quality will increase and have a positive impact in product pricing. The R & D division also engaged its full effort to introduce new products with the existing. The company also emphasized to discover the new export destinations for its products.
“By changing our business strategy and efficacy the Net Profit After Tax stood in 43% growth by adding BDT 125.35 million then previous year. The uninterrupted production and timely delivery are the tradition of this company. On the other hand, our export revenue has increased around 38% by adding BDT 270 million comparing to previous year.” Said Mr. Safwan Sobhan, Managing Director – BPML in the report
Some core products of this company Bashundhara Paper, Bashundhara Tissue, Bashundhara Diapant has awards as the honor of excellence “Superbrand” during the year. Bashundhara Tissue has honored as “Asia’s Greatest Brand and Leaders for 2020-2021”. And it was possible for tremendous efforts and support of our resilient workforces and strategic decision of the board in this tumultuous period.
Production and Sale:
In spite of challenge of Covid-19, the product line of BPML was on full swing except the lock-down period and able to produce 98,790 MT finished goods of papers, sack, sludge, board & tissue papers and in the hygiene segment the production was around 3,644.26 MT during the period under review which was the 68% average of production capacity.
In FY 2020-2021, BPML was able to earn the net revenue by sale of paper and paper products amounting to BDT 9,282 million which was BDT 8,544.46 million in the FY 2019-2020 which was increased by 8.64% from previous. BPML also engaged its expert team to monitor the emergence of new competitions and risk issues. Although the global crisis, the export of this company increased by 37.07% than previous year and the export was 10% considering domestic and foreign revenue.
JK Paper reports 152% jump in Profit after Tax for Q1 (Fy 22-23), robust paper demand remained strong
New Delhi | 29th July 2022 | The Pulp and Paper Times:
JK Paper Ltd., one of India’s largest Paper Companies recorded its best ever quarterly consolidated Turnover at Rs.1,508.05 Crore (up 109%), an EBITDA of Rs.458.09 Crore (up 104%) and Profit after Tax (PAT) of Rs.261.98 Crore (up 152 %) for the quarter ended June’22 (Q1) as compared to corresponding quarter of previous financial year.
Commenting on the results, Mr. Harsh Pati Singhania, Vice Chairman & Managing Director, said, “the Company was able to deliver strong performance on a quarter to quarter and YoY basis on the strength of higher production and sales volume and enhanced sales realisation coupled with an enriched product mix. This is inspite of adverse impact of substantial increase in major input costs in the recent period. Demand for Paper and Board continues to remain strong. The new Packaging Board Line has stabilised well and achieved high capacity utilisation.
The Sirpur Paper Mills Ltd., a step-down subsidiary, continued to contribute to the Company’s overall profitable growth.”
During the quarter, Unit JKPM, Odisha, has been awarded with Platinum (First) Prize in Overall Digitalisation Category of FICCI Industry 4.0 award. The Company continues to pursue its social farm forestry initiatives aggressively in the areas close to the Plants.
Packaging grade paper demand plummeted; silent shutdown by paper mills, the headwind is expected to continue for a couple of months
- Price of Imported OCC from Europe and US has come down to $250 PMT from $ 350 pmt in March.
- Prices of Kraft waste paper is hovering between approx Rs 19/ per kg to a maximum of Rs 21.50 per kg.
- Paper mills all across Gujarat are taking silent shutdown ranging from one week to ten days in a month.
- New Capacities in Kraft and duplex may also cause overproduction in the market.New Delhi | 23rd June 2022 | The Pulp and Paper Times:
Growth in the eight infrastructure sectors of the economy slowed in March after recovering to a four-month high in the previous month after supply-side disruptions caused a contraction in coal and crude oil output and a slowdown in some others.
The slow growth is mostly due to soaring prices and the subsequent hit to consumer spending and investments, according to analysts.
At present, the main reason for the continued decline in the market is the huge reduction in the demand of both finished paper and waste paper in the market. The decline in domestic waste collection has been due to the reduction in consumption and use of consumer goods at the domestic level.
â€œThe market is in a very struggling position for the last one or two months, according to me, the world economy is getting disturbed and changes are taking place, and the sales of the products in the core sector have decreased like you see in steel, edible oil, Automobile, and other sectors. The slowdown in demand of core sector is also impacting the packaging grade paper. Recycled Kraft and Duplex demand have seen a significant decrease by registering a price drop of Rs. 10 to 12 per kg in last two months,â€ says Indian Recovered Paper Traders Association (IRPTA)â€™s President Mr. Naresh Singhal.
The Price of Imported OCC waste from Europe and US have dropped to $250 PMT from $ 350 pmt in March. In the current scenario, the price of OCC is expected to be more plummeted to compete with Indian domestic recovered paper market, where the prices of Kraft waste paper is hovering between approx Rs 19/ per kg to a maximum of Rs 21.50 per kg. In March, the Domestic price of waste paper had touched to Rs 32 to Rs 34 per kg in march month.
â€œThe situation is very worse in Gujarat, due to lack of demand, most of the paper mills are not willing to discharge their imported OCC from the port, few indenters and shipping line are selling these goods at a cheaper price say $ 200 or $ 210 pmt to clear the port congestion,â€ said Mr. Bhavesh Rajput an Indentor of Imported OCC at Gujarat.
Mr. Singhal further says that Packaging paper distributors, dealers, paper converting industry like box manufacturers, and printers reduced their stocks and inventory expecting more rates declination and also heavy money crunch in the market. It has been observed that all stakeholders in paper trade like paper mills, paper dealers, paper conversing units and also recovered paper traders everyone is passing through the process of price correction since long. Since last week the rates of All grades of recovered paper have declined a lot. There is a number of reasons behind this, but none of them is specific.
There will be no significant change in the demand for kraft paper as there is no possibility of any increase in the demand of consumer goods in July month. Due to short supply of duplex in the market by duplex mills in the past, the demand may remain higher than the current month in July as the stock of duplex is available in very controlled quantity in the market due to good understanding of duplex mills.
â€œMost of the Duple and Kraft mills Uttar Pradesh and Uttarakhand have taken a shut down since last week to control the damage due to price decrease, and also to hold the price of finish products uptick,â€ Mr. Singhal pointed out.
Mr. Rajput informed that due to liquidity crunch and demand decrease, paper mills in all across Gujarat are taking silent shutdown ranging from one week to ten days in a month.
â€œPaper Mills are not interested to place new order for imported OCC at a higher price which is not proportionate to local waste price. Domestic waste paper price is hovering between Rs. 19 to 21 per kgâ€ Mr. Rajput says.
In this regard Kraft paper and duplex board manufacturers have reduced the rates of bottom grade recovered paper up to 10% only in last week
â€œMonsoon season is running in most of the parts of the country and has to reach soon in rest parts of the country. As per our past track record, we observe that monsoon season is always poor time for recycled paper and recovered paper bothâ€ he says.
As the monsoon is approaching, a paper mill does not want to keep the goods in the open, there has been apprehension of catching moisture due to rain.
Sluggish demand of finished has further dropped the US and Europeâ€™s OCC prices by $30 per metric ton.
â€œAs per our past observations, I feel, market trends will almost remain same or can very within the range of+_4/5% till the end of the first week of August. It's my personal opinion.â€ Mr. Singhal said
While the readings have broadly come In line with expectations, the outlook remains clouded with uncertainties especially with escalating crude oil prices. Further, weak labor markets, limited ability on additional fiscal spends, reduced corporate margins due to rising input prices and weaker global demand remain a concern,"" said Upasna Bhardwaj, economist at Kotak Mahindra Bank, reported in leading daily.
Recovery in Indiaâ€™s domestic macros have been resilient to risks arising from global developments; however, supply-side challenges and inflation spikes, which could dampen consumption and investments in the economy, poses near term risk to Indiaâ€™s economic growth
Vietnam, India Look at Greater Trade In Paper Products
HCM City (VNA) - Trade in paper between Vietnam and India is quite low and there is significant potential for growth, a meeting between Indian and Vietnamese paper companies heard in HCM City on February 9.
K Srikar Reddy, the Indian consul general in the city, said bilateral trade had grown more than 60 fold in the last two decades to 10.13 billion USD in 2016-17, noting that India is now among the top 10 trading partners of Vietnam. However, India exported paper worth 38.17 million USD to Vietnam last year, only 3.26 percent of its global exports, he said.
India imported paper worth 2.7 billion USD, with just 7.78 million USD from Vietnam, he said.There is thus much scope to promote bilateral investment and trade ties in the sector, he added.
Hoang Trung Son, vice chairman of the Vietnam Pulp and Paper Asso-ciation, said the paper industry has seen outstanding growth of 11 percent a year and can meet 64 percent of demand.Last year Vietnam imported around two million tonnes of paper at 1.7 billion USD, mainly from Asian economies such as China, Taiwan, Indonesia, the Republic of Korea, and Japan.
According to Son, Vietnam has started importing paper from India with the volume increasing year after year. Thanks to the Free Trade Agreement between ASEAN and India (AIFTA), the import tax on main paper lines is decreasing gradually, increasing the competitiveness of Indian paper.
Son said the association believes that there is plenty of opportunity for cooperation between Vietnam and India in both paper production and trading. The meeting was attended by delegation of 44 Indian companies belonging to the Federation of Paper Traders Association (FPTA).
According to the FPTA, India's paper demand is expected to grow by 6-7 percent in 2016-22 and reach 19.9 million tonnes a year by 2022. A shortage of raw materials and higher costs are preventing the industry from increasing production and the country has to rely on imports to meet demand, it said. Shekar Chandak, leader of the visiting business delegation, said the main purpose of the visit is to explore opportunities for both exporting paper to Vietnam and buying from it.
â€œIndia imports a lot of wood chips also for the paper industry. We are importing from Australia, Japan, and South Africa. â€œAnd Vietnam is a big producer of wood chips, so there is a huge opportunity for importing wood chips also,â€ Shekar Chandak said. He added that India also has some special paper which it can export to Vietnam. -VNA