Alok Gupta
Only 2 days after lifting the ban on puchases, market slasheded steeply. Few day back where mills who were demanding 6 to 7 rs. per kg increase & telling that they have already booked for whole april have suddenly changed their attitude. Today they call 4-5 times in a day & demands for order with a increase of 5 rs. or even lesser which is a very dramatic scene.
It is also not good of our buyers (convertor), who fought for their rate increase a long way and now this news may undo their efforts.
Alok Gupta
yesterday most awaited decision was taken by NIKDA. All member present nominate NIKDA Executive body as under:
Sh Suresh Chand jain will be Chairman of the Association, sh Mukesh Gupta will be President , sh. Akhil Gupta will be Secretary & sh. Ram Babu Goel will be Treasurer. Subscription of the association will be 5100/- per member.
Soon constitution of this body get prepared & then we will register it.
Alok Gupta
Today, at 12 p.m. Northern India Kraft paper Dealers' Association has arranged a meeting to review the position of Market.

In my opinion NIKDA should open the ban on purchases as most of the mills or say their associations came to a realization that a decorum of rate will be maintained.

Apart from this it is high time to nominate the executive body of this forum for the further smooth working.
Alok Gupta
FRIENDS,
One of our friend Mr. Pankaj Aggarwal from Noida send us the under mention data:
The landed waste paper (OCC) price from USA and Dubai for the year 2008 and 2010 is shown below:

US OCC

Dubai OCC

Year

2008

2010

2008

2010

JAN

260

235

225

200

FEB

285

280

248

230

MARCH

290

300

250

250

APRIL

275

240

MAY

260

220

JUNE

255

220

JULY

270

240

AUG

250

215

SEP

245

210

OCT

230

200

NOV

135

103

DEC

110

120

Average

239

208



Please note that this years OCC prices for Jan Feb and March are not an abnormal rate for which the mills are making so much noise.
In the year 2008 Jan - March and this year 2010 Jan - March price are same.
However the increase in paper price in both years are not same. Even after making adjustment for the $ Power, Coal etc. the current price rise is not justified on part of the mills.
Hence a strong correction is expected and requested in imported waste based paper prices starting from May 2010 onwards.
Alok Gupta
Meeting of North India Kraft paper Dealers Association (NIKDA) was held yesterday and once again dealers stick to their decision "no new purchase till 12-04-2010". The unity and bonding is very good. More then 100 dealers joined the forum and agreed that it is essential in the interest of trade to close/stop all purchases.
Although in my opinion under present rate increase scenario, market is flooded with material because dealers & converters, both made panic purchase. They purchased much more quantity then they required. This would help mill owners to increase prices further. But now dealer & converter, have started feeling the shortage of space as well as finance at some places. Converters are not in a position to repay as per agreed terms because they bought excess material then they required, besides due to closing of financial year there is already a financial crunch.
But I firmly believe that this decision is very much beneficial for the PAPER TRADE.
Alok Gupta
Today we are talking about current senerion of paper prices. While it appears that paper prices have leap frogged, but if one looks at the situation in greater depth, one would realize that it is only a function of dramatic cost increases, especially in pulp and fibre.

I would like to inform you that current uncoated prices of USD 1000 FOB translating into USD 1050 CIF on average, is roughly equal to the long fibre price as on date. There is no long fibre available less than USD 980-1000, while hardwood pulp is at USD 825-850. Normally, to sustain paper business, the spread between Pulp and Paper price needs to be anything like USD 250-300.

Keeping in view the factors such as strike in Scandinavia, wet weather in US/Canada, Chile earthquake ,NGO movements protecting forests, withdrawal of black liquor credit to pulp mills in the US, energy prices, freight rates and other general inflationary pressures and this is not only in international market the situation in our domestic market is also worst i.e. increased prices of local waste paper, hike in petrol / diesal / wheat straw / baggas prices and not only increse non availabilty is alos a big factor.It seems that fibre will remain stiff in the near/medium term.

Paper companies including distributors have been bleeding in the recent past, this needs to be explained to consumers. It is in the ultimate interest of consumers/ market/ industry that everyone makes a reasonable margin and industry attracts fresh investments for capacity and modernisation. We do understand the consumers backlash in such a situation, however, you would have noticed imported paper price to have shown more radical change than domestic players. Most of the Pulp/Paper Mills around the world are fully booked till end May/ early June.

This letter is to update you with some of the latest happenings around the industry and hope that you find it useful in explaining to the consumers the rationale behind the recent price movements.
Alok Gupta
From today Duplex manufacturer started charging VAT @ 4% in place of 12.5% (in Uttar Pradesh)as in the past.
It is very confusing decision as if they follow the decision of Khanna Paper Agency’s appeal (which was decided on 03-06-09) then till now why they are charging 12.5%?
If commercial tax department raise demand against this difference of tax then who will be liable for tax as well as for interest & penalty? Manufacturer or Dealer or Converter?
Alok Gupta
Yesterday Kraft paper mills of north India called a meeting and inform some dealer to join them. Most of the dealers refused to attend the meeting. But it is very unfortunate that out of us 7-8 dealers joined them. Again mill owners dictate us that they will give us material up to 15-4-10 with an increase of 5/= per kg. and afterward on increase of 6/= per kg.
Now I wish to question all of us that when previously they committed to give us 21% of the material in April at increase of Rs. 3/= & afterwards up to 31-5-10 they’ll give us the material at increase of Rs. 5/= then why do we even think/consider any such offer. If they don't fulfill their previous commitment then how can we rely on them?