Paper prices are likely to move up in India

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paper industry

The year 2017 was a record year for the import of pulp used for papermaking in Asia. China has led this growth over the past ten years and if its consumption growth for lumber and pulp were to continue, it would consume the entire world’s forest products in a few years, according to industry commentators. Although Chinese president Xi Jinping has tempered the unlimited growth of the country’s construction industry, its paper industry continues to demand pulp as do Japan and India.

Pulp prices have hardened recently with major pulp producers shutting down for annual maintenance simultaneously with China banning the import and use of ‘mixed paper’ or paper waste. Hardwood pulp prices have hardened and hit a 7-year high in the US$ 770 per ton range while softwood pulp is in the US$ 660 per ton range. This represents an increase of more than US$ 240 a ton in the last six months.

India, which suffers from a huge fiber shortage, still produces some pulp from bamboo, eucalyptus and other types of trees, which is suitable when used together with waste paper and imported pulp for manufacturing writing and graphic papers. With the import customs duty at nil since May 2012, the industry currently imports about 1.25 million tons of pulp for paper making.

This is in addition to considerable (more than 3 million tons) newsprint, paper and paper board used for high quality packaging imported at various customs rates. Leading industry associations such as Assocham have argued for the imposition of a 10% customs duty on pulp which would, according to them, encourage the forestry farming industry in the country as well as the paper industry. Assocham estimates the shortfall of domestic pulp could be met with harvesting approximately 160 million trees annually.

Undoubtedly, the currently high price of pulp imports will impact the manufacture of the writing, printing paper and paperboard varieties that are bouyant right now. It will especially put further price pressure on the carton market, which uses imported pulp to produce high quality paperboards that are made from imported virgin pulp. Together with increases in fuel costs and chemicals, printers, publishers, print buyers and packaging converters should be prepared for another round of paper price increases in next few months.

This article has been slightly corrected on 13 February 2018 — Editor

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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