Rising prices hurting paper industry badly

The recent rise in paper prices by around Tk 50,000 per tonne has majorly impacted the market in Bangladesh and disrupted the supply chain.

According to millers and traders, pulp shortage, electricity and gas crisis, record dollar rate increase, and rising prices of raw materials are the reasons behind the price hike.

All these issues have forced most of the industry’s big manufacturers to halt production and that played a major role in creating the supply shortage and hiking the prices, said Bangladesh Paper Merchants’ Association (BPMA) Director Md Nurul Amin.

These problems have also forced some new entrepreneurs to stop their production as well, which is only adding to the crisis.

According to the importers, Bangladesh imports less than 20 per cent of the paper and more than 75 per cent of the raw materials. The rest of the national demand is met by locally recycled waste papers.

Md Humayoun Kabir, the owner of Mohammadia Paper Store at Old Dhaka’s Nayabazar, told The Business Post that the prices have shot up by around Tk 40,000-50,000 per tonne in just one year. “Now a tonne of paper is being sold at Tk 1.20-1.30 lakh, which was Tk 70,000-80,000 last year.”

Creative Paper Mills Ltd owner Md Feroz Ahmed said he was compelled to stop production due to the pulp shortage and after the dollar rate and prices of raw materials went up.

Pulp is the main raw material for producing paper. The country imports it from Indonesia, Brazil and Canada to meet the millers’ requirements.

“Though it is the peak season for paper traders, I sold only 1,900 tonnes last month. I usually sell 3,000 tonnes per month,” he said.

The last quarter of every year — October, November and December — is the peak time for the paper and printing industry.

Md Ismail and his three friends have jointly invested over Tk 20 crore in RS Paper Mills located in Meghna Ghat and MAP Paper Board Mills in Jamalpur. But they were forced to close the first mill until further notice because of power crisis, he said.

“The high rates of all raw materials and pulp shortage have also created extra pressure on us,” he added.

Bashundhara Paper Mills Ltd Chief Sales Officer Md Masudur Rahman also blamed the same problems.

Talking to The Business Post, Printing Industries Association of Bangladesh Chairman Shahid Serneabat said, “We are in crisis mode. Most of the printing industry will not be able to produce quality books on time because of these problems.”

Industry people say more than 80 per cent of the products are used for writing and printing.