Paper price hike causes consternation among printers

JK Paper raised the prices of key products last week. And from today (1 September), Ballarpur Industries and Tamil Nadu Newsprint and Papers will implement the price rise, as well.

In an interview to a business channel, AS Mehta, the president, JK Paper spoke about the five percent price hike in its products on the back of increasing input costs. He stated that there may be a case for a further hike soon, if the rupee-dollar parity sees further fall.

After hitting an all-time low of 68.8 against the dollar last week, the rupee ended at 65.7 on 30 August 2013, a fall of 10.38 per cent since July 1. On 2 September, the rupee is trading at 65.8.

Mehta added, "The demand, supply and capacity are balanced. We need to keep an eye on the pricing. This is in lieu of the cost of the imported paper in some categories. I need to keep the pricing at par with the imported one. With rupee's fall, the cost of imported paper has also gone up."

At the moment, India imports 40 per cent of its coated paper volumes, which is equal to 5,50,000-6,00,000 tonnes. This segment is expected to see a price hike along with packaging boards.

Presently, wood prices have risen by 10-15 per cent. In July 2013, the average price of pulp remained unchanged at $832.02, after a 1.84 per cent rise in June, according to indexmundi.com.

In 2012 too, paper majors, such as Ballarpur Industries, JK Paper and West Coast Paper Mills effected hikes and passed on the input costs to consumers. At that time, coated paper was selling at Rs 56,000 to Rs 57,000 per tonne.

Print associations around the country have reacted with consternation at the latest paper hike. Most of them, feel this is a body blow to print firms who are coping with "reduced margins and shrinking print budgets".