The entire absorbent craft paper using industry is hinged to the hugely volatile Kraft paper market scenario. The demand and supply in kraft paper has been a big mismatch since last two years. Particularly the scenario for last 3 months has been scary again and again. The kraft paper prices passed 34 begin to damage the HPL sector because market does not cooperate to pay for the rising cost after that. This took a heavy toll on depending industries like decorative laminate or corrugated box industries. Whether it is liner grade range, industrial grade or claddings, each HPL product category is feeling the hit during last 3 weeks of February. Due to supply and price mismatch, laminate industries are clueless and in disarray. Even the price rise announced by the industry is of no help says laminate producers.
The B grade kraft paper is selling at Rs 45 a kilogram from the last week of February 22 which was hovering in the range of Rs 25 before covid. That is around 80% of jump in prices in last two years. Mr Kishor from Gurukrupa Industries, Ahmedabad said, the reason mainly is hike in kraft paper cost is due to high prices of waste Paper. The collection of scrap paper is not happening due to which the wasted cartons, etc are not coming back into the supply chain for recycling. Paper Mills cite the main reasons for their increase in inputs cost and hence the rise in the price of their final product, the Kraft paper.
On the other side the Kraft producing companies are also cribbing about increase in working capital needs, says Mr Kishor. Mr Hasmukh Agarwal from Ahemdabad says that the prices will not come down to previous level of below 30 in near future and it will continue to remain above 40 for another two-three months.