Reports in India have said that corrugated box buyers are not prepared to pay the higher prices being driven by the increased cost of imported recovered fibre.
In an article in The Hindu Business Line, Material Recycling Association of India (MRAI) paper committee chair said that kraft paper prices have now reached the pre-Covid level of 27 rupees per kg, from 19-20 rupees during the pandemic.
He noted that paper mills had incurred huge losses as the waste paper inventory they were holding during Covid lockdown was a cost without revenue, while still having to maintain salary and other costs during a forced shutdown of their operations.
On top of that, imports of raw material from Europe had increased from $100 per tonne prior to the Covid period to $200 to $220 per tonne now. He expected that prices would continue to rise in the near future as the US and Europe were still collecting less material, while China had also been stockpiling ahead of its import ban at the end of the year.
However, the Federation of Corrugated Box Manufacturers of India has warned that the manufacturers that require the boxes for packaging are not prepared to absorb the cost increase, making business unviable for box manufacturers.
Box manufacturers also suspect that Indian mill groups have been cutting production in order to increase prices, but this has been denied by MRAI.