Print CEOs from BMPA and MMS discuss paper price hike in Mumbai

These meetings attended by heads of print companies are attempting a draw a plan in response to the paper mills who will increase writing and printing paper prices from 1 May 2010.

Anand Limaye, a mentor at MMS and Maharashtra Mudran Parishad stated: " The steep and sudden price rise of paper and paperboard, has unnerved the entire printing industry. In some cases it's a matter of survival."

Paper officials are expecting a rise by Rs 2,000-2,500 a ton, or 5-6 per cent due to higher input prices and slowdown in imports.

Currently, prices are in the range of Rs 40,000-44,000 a ton.

Globally, pulp prices have been rising. Hardwood pulp prices, for instance, have increased from $550 to $850 a ton since December.

This led to a further increase in paper prices, which are now ruling in the range of $1,000-1,100 a ton.

Ramesh Kejriwal, managing director of Parksons Packaging, who was one of the important delegates at the BMPA meet on 16 April, in Mumbai stated: "Paper mills have to convey the price increase with cost escalation justification in clear terms to the printers. This message should be passed on by the printers to their end customers."

Kejriwal added: Printers through their association should set-up a dialogue with the paper mills or their association to explain the importance of having a price revision not earlier than a quarter. This will help printers to plan properly."

During a closed door meeting held on 20 April in Mumbai, paper traders said that global pulp production has halved due to higher cost of wood and an earthquake in Chile which is a major pulp producer.

In India, demand has been buoyant due to a reviving domestic economy, government focus on education, plus the boom in packaging converting. Various segments of the writing and printing paper such as copier and coated are growing in double digits.

A paper trader stated: "BILT, ITC Bhadrachalam and JK Papers are planning $3 billion worth projects which are under implementation. Also, a capacity addition of around 3,00,000 tonnes is expected in the current year from West Coast Paper and Tamil Nadu Newsprint and Papers. This should boost capacity"

P Narendra of Pragati Offset is not hopeful. He stated: "There has to be a clear-cut government policy about large tracts of land to the paper mills so that large-scale afforestation is done. This would entail that we can aid the environment and get the pulp. In absence of this, it is difficult to become a major paper producing country."