Overview of

Indian Paper Industry

Presented by

Dr. R.M.Mathur
CPPRI

Central Pulp & Paper Research Institute

Saharanpur, U.P., INDIA
 PAPER INDUSTRY AT A GLANCE
The industry is fragmented with capacities ranging from 2 to 800 tonnes per day
¾Total number of Pulp & Paper Mills 666
Wood Based 34
Agro Based 165
Recycled Fiber Based Mills 467
¾Pulp & Paper Mills in Operation 568
¾Pulp & Paper Mills Closed 98
¾Installed Capacity of Mills 9.5 million tonnes
¾Per-capita consumption 7.0 kg
(Paper & Paperboard)
¾Production 6.5 million tonnes – P&B
0.9 million tonnes - Newsprint
¾Turnover Rs. 16000 crore
¾Exchequer Rs. 2500 crore
¾Employment Direct-3 Lakh / Indirect-10 Lakh
1
 GROWTH OF PAPER INDUSTRY ….. Contd…

10

8
Million Tonnes

0
1950 1960 1970 1980 1990 2000 2005 2006

Capacity Production

Paper capacity and production in India 1950-2006

2
 High level of sickness in the industry
Nearly 1. 25million tones of capacity is closed

Reasons for Closed Capacities

¾ Technological obsolescence
¾ Environmental issues
Nearly 194 mills under the purview of the Board of Industrial
and Financial Reconstruction (BIFR) and nearly 60 mills
(with a capacity of 1,25 million tonnes is closed).
With the implementation of ECF norms expected to involve
higher cash outlays, the viability of smaller plants is an area
of concern.
 STRUCTURE OF PAPER INDUSTRY
Categorization of the Mills Based on Cellulosic
Raw Materials

467
500

400
Number of Mills

300
165
200

100 34

0
Wood Based Non Wood RCF Based Mills
Mills Based Mills

4
 Structure of Paper Industry

Paper

Paper & paper Newsprint

Board

Writing & printing paper Industrial Paper

Maplitho Creamwove Copier Coated Kraft Duplex Grey and

white
board
and MG
poster

5
 Percent Share of products

Indian Paper
Industry
6.5 Million Tonnes

Writing Printing Industrial Paper Speciality Paper

paper
(58.1%) (4%)
(37.9%)

Creamw Maplith Coated Kraft Duplex Others

ove o (incl b
(18.47%) (54.02%) (28.26%) (17.72%)
(55.0%) copier)
(26.53%)

6
 Fiber Resources and their Availability

Fiber Sources of Resources Production Proportion No. of Proportion

Resource Million in Mills of Mills (%)
Tonnes Production
(%)

Wood Eucalyptus, Coniferous and 2.08 32.0 34.0 5.1

other broad leaves

Agri residues Bagasse, rice and wheat 1.95 30.0 165.0 24.7
straw, cotton stalks, etc.

Waste paper Domestic and imported waste 2.41 38.0 467.0 70.2

Source: Federation of Paper Traders Association of India

7
 PER CAPITA CONSUMPTION
While India accounts for nearly 15 per cent of the world population, it consumes
only 1 per cent of the world paper production. India.s per capita consumption of
paper at about 7kgs is very low as compared to the world average of 50 kgs.

Consumption Per Kgs

350 324
300
250 202
200
K gs .

150 98
100
32 29 24 24 76
50
0
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8
DEMAND & SUPPLY SCENARIO
Paper Industry to witness firm Demand
¾ Demand for paper industry is closely linked to the economic
growth of a country.
¾ The paper industry has grown at a steady 6.0 per cent over the last
few years and it is expected to grow by 6.6 per cent over the next
2-3 years.
¾ The increase in demand will stem from faster growing varieties of
paper -coated paper, copier paper and duplex boards.
¾ Capacities to the tune of 1.5 million tonnes (20 %of current
capacity) will come on-stream over the next 3 years. This will result
in a decline in operating rates over the next 2-3 years till the
additional supply is absorbed by the incremental demand.
¾ Although input costs are expected to increase over the next few
years, the rise in price of paper will not be steep due to an
improvement in plant efficiency due to the the modernisation being
carried out by mills.

10
 Paper- Variety wise demand forecast Thousand tonnes
2004-05 2005-06 2006-07 (E) 2007-08 (E) 2008- 2009-10 CAGR(%)
09(E) (E)
Writing and printing paper 2181 2307 2441 2583 2727 2880 5.7
Uncoated paper 1887 1987 2091 2202 2311 2428 5.2
Craemwove 1185 1235 1288 1344 1398 1455 4.2
Maplitho (incl unbranded copier) 575 605 634 665 698 734 5.0
Branded copier 127 147 169 192 215 239 13.5
Coated Paper 294 321 350 381 415 452 9.0
Coated crome paper 114 123 133 143 154 166 7.9

Art paper 101 113 127 142 159 177 11.9

Art boards 80 85 90 96 102 109 6.4

Industrial Paper 3370 3589 3821 4068 4331 4615 6.5

Kraft 1833 1964 2102 2249 2406 2574 7.0

Duplex (incl. Coated and uncoated) 963 1037 1115 1201 1294 1395 7.7
Grey and white board 274 284 294 304 315 326 3.5

MG poster 299 305 310 313 317 320 1.3

Speciality 239 257 277 298 321 346 7.7

Total of above 5790 6154 6539 6949 7379 7840 6.3
Newsprint 1347 1491 1623 1792 1902 2000 8.2
Total 7137 7645 8162 8741 9281 9840 6.6
11
RECYCLED FIBRE - RECOVERY & RECYCLING
¾ Import of waste paper is continuously increasing
¾ At present more than 80% of consumption is met through imports.

8 Million tons
6
4
2
0
1995 2000 2005 2010

Recovery Imports Consumption

12
COSTS AND PRICES
Cost Structure

The main costs for a paper manufacturer are raw materials and energy.
These two account for nearly 60-70 percent of net sales.

Raw materail
Chemicals
cost
10%
27%

Overheads
32%
Power & fuel
Personnel cost 20%
11%

14
 Indicative Cost Structures

Indicative cost structure per tonne of paper Rs. / tonne Percent of total
(Rs.) cost
Raw material
Wood & bamboo/ Mixed Waste and Market BKP 5000 27
Stores Chemical and spares
Sodium sulphate 320 2
Lime 800 4
Chlorine 700 4

Fuel
Coal for boilers 3750 20

11637 57
Personnel costs 1800 11
Overheads 5,500 32
Total costs 18937 100

15
 Energy Usage Pattern in a mill

Power consumption (%) Steam consumed (%) Potential

Large mills Small mills Large mills Small mills savings in
power

Chipping 4 6 - - 25
Pulping 22 29 21 11
Stock making 18 25 - 58 12
Recycling chemicals 16 - 44 - 33
Paper making 40 40 35 42 40

Note
In India, only 55-58 per cent of energy is used and the balance (42-45 per cent) is wasted.
However, international plants use 76-78 per cent of energy and waste only 22-24 per cent.
Source: CRIS INFAC, Industry

16
 Energy usage pattern: International vs Indian Paper Mills

Bleached varieties Steam t/t Electricity Kwh/t

International Indian International Indian
Chip conveying - 20 20
Digestor 0.61 40 40
Washing and screening - 1.30 30 110
Oxygen delignification 0.18 75 n.a
Bleaching 0.83 0.30 100 80
Paper machine 1.50 2.50 253 600
Soda recovery 1.50 2.60 55 125
Power plant 0.83 1.20 60 125
Kiln & recausticising n.a n.a 25 n.a
Hot water Supply n.a n.a 32 50
Wastepaper treatment n.a n.a 30 40
Miscellaneous/unaccounted/loss 0.00 1.10 30 110
es
Total consumption 5.45 9.00 750 1300

Source: CPPRI
n.a : Not applicable

17
INDIAN PAPER INDUSTRY IN GLOBAL
PERSPECTIVES
INDIAN PAPER INDUSTRY IN GLOBAL PERSPECTIVES

India is among the top fifteen global producers

Paper & Board Capacity (2000)

US
China
Japan
Canada
Germ any
Finland
France
Korea
Sw eeden
Indonesia
Brazil
Russia
United Kingdom
Taiw an
India INDIA
Mexico
Thailand
Australia
South Africa

‘000 tonnes
Argentina
Colam bia
Chile
Venezuela

0 20000 40000 60000 80000 100000 120000

Source : ICRA report to IPMA : 2000

19
Indian Paper Industry in Global Perspectives… Contd…

¾ World Paper & Board consumption is dominated by three major regional

blocks- North America, Western Europe & Asia.

¾ The Paper & Board and Newsprint production in India is nearly 7.5 million
tons as against world paper production of 340 million tons.

PERCENTAGE OF WORLD PAPER PRODUCTION

North
America,
Europe, Rest, 9.0%
31.0%
28.0%

Asia, 30.4%
India, 1.6%
Indian Paper Industry in Global Perspectives… Contd…

CONSUMPTION OF BASIC INPUTS

Input Norms Mills in India Mills Abroad

(per tonne basis) (Wood Based)

Raw material, tonnes 2.0- 2.4 1.8-2.0

Energy, GJ 23-37 18-22
Water, m3 120-200 20-60
Chemical Recovery,% 85-95 95-98
Manpower, no. 14-20 5-7
Technical manpower, no. 2 4
Fibre Recovery, % 15 40

21
 COMPETITIVENESS OF THE SECTOR

¾ As compared to USA, Europe, the paper industry in India is far

below the quality standards of the products.
¾ It is not as competitive as in other Asian countries such as ; Japan,
Indonesia, Thailand, Malaysia & China.
¾ The paper industry in India is less competitive as compared to
similar sectors such as; cement and capital goods.
¾ The possible reasons which makes paper industry less competitive
compared to other similar sectors are –
(i) Availability of good fibrous raw materials;
(ii) Level of technology.

22
STRATEGIES FOR IMPROVING COMPETITIVENESS

INDUSTRY GOVERNMENT

IMPROVING
RETURN/MARGINS Raw Material Sourcing Policy for Industrial
Plantation

Technology Up gradation & Technology Up-gradation

Restructuring Scheme

Product Focus Environmental Policy

Environmental Credentials Rational long term policy on

Duties and Taxes

Implication of WTO
Rational pricing policy for
Power & water
Capacity Expansion
23
Technology – Status and
Upgradation
 TECHNOLOGICAL STATUS
¾ Obsolescence of technology in most cases.
¾ Lack of eco friendly state of the art processing technologies.
¾ Uneconomic scale of operation.
¾ In an international comparison, even the largest machines are medium-
size
− The average capacity of paper machines is about 14000 t/a
− Most of Indian paper machines have a trim width from 1.5 to 3.5 m
− There are only 9 paper machines with trim width of 5 m or more
− Only 14 machines have capacities 50000 t/a or more
¾ It is not possible to have very high speed paper machine, i.e. >1500 mpm
for type of raw material available in India
¾ Similarly for adoption of new papermaking technology quality of raw
material and mill size are the major limitations.
¾ Except the wood based integrated mills and few agro/RCF mills the level of
automation and process control is very low in most of the mills 25
TECHNOLOGICAL STATUS IN OTHER AREAS
Section Advanced Countries India
Raw material −Mechanical handling −Manual handling practices
preparation
in some mills
−Raw material washing − Generally washing &
debarking not done
−Debarking − Debarked logs are procured
Pulping
−Continuous digesters − Mainly batch scale pulping
RDH pulping − Only practiced by some
Chemical −Oxygen delignification mills
Groundwood pulping,
TMP process, CTMP Generally CRMP
Process
Newsprint
BSW Mostly double wire Counter current washing
washer poacher washer in agro based
mills
Bleaching TCF &ECF bleaching Chlorine is still being used in
most of the mills
26
Cont..
 Section Advanced Countries India
Chemical −Falling film type −Generally LTV, STV in
Recovery evaporators some mills
−No direct contact −Direct contact
evaporators evaporators still used
−Equipped with lime −Only some mills have
burning kilns lime kilns
Rewinders Automatic rewinders Manual
Sheeting & A/c Finishing housed Little automation
Packaging
Totally automation
ETP Activated Sludge Process Generally Primary &
Secondary Treatment with
High Rate
aeration lagoons
Biomethanation
Tertiary Treatment

27
 Suggested Initiatives
¾ Information dissemination of technology
demonstration
¾ Easy finance availability
¾ HRD initiatives
¾ Policy Intervention (i.e. de-reservation from
SSI etc)
¾ Creation of common infrastructure

28
 CASE
STUDIES

29
Provision for indirect heating arrangement for batch digesters

Direct
Steaming

Heater or
DIGESTER Injection DIGESTER
heater

STRAIN
ER

Condensate

Existing Direct steaming System Modified In-direct steaming System

Economic Analysis:
Investment : 5 Lakhs ( Each Digester)

Payback Period : One Year

30
Up gradation of the pulp Washing systems to reduce the
organic carry over to bleach plant and to extract maximum
chemicals.

Existing three stage brown stock Modified four stage brown stock
washing system washing system

Economic Analysis:
Investment : 30 Lakhs

Payback Period : One Year

31
Up gradation and on line control of stock preparation and
paper machine

Existing paper machine Online measurement systems Modified stock preparation

Economic Analysis:
Investment : 15 Crores

Payback Period : 7 Years

32
Retrofitting of Conventional Coal Fired Boiler to F.B.C. with
Matching Turbines

Existing Stoker coal fired boiler

Economic Analysis:
Investment : 20 Crores

Payback Period : 8-10 Years

Coal fired fluidized bed boiler

33
 ADOPTION OF UPGRADED BLEACHING SYSTEMS
EXISTING PROCESSES
B.Stock Hypo
Chlorine Caustic
Washer - Washer Washer Washer
Hypo
Fresh water
III Fresh water No. 1 Washer Fresh
Alka No. 2 water
li + Hypo Hypo Hypo
HD Chlorin Chlorin Alkali Hypo
LP H2O
Tower e e Tower Towe Tower Tower
Steam
2 HD
C r No. 1 No. 2
Injector
Towe
l r
To
Seal 2 Hypo
Tank Chlorine Tower
Mixer No.2

To Drain To Drain To Drain

To Drain

PROPOSED MODIFICATION
Cl2- Option LC Washer - 2 Washer 3 White water
Pulp Water Washer - 1 H2O2 Hypochlorite
from C
screeni l
ng OStatic
Pulp from
2Mixer Pulp from
Pulp from EO - Storag
DO D - stage EO D1
screening C or O or
stage C or e
l C 2 EP l H Tower
Tower Pulp
O Tower O Tower
to
2 2 Paper
MC Mixer MC Sparger MC Hi- Shear Mach
Pump Pump Pump Mixer ine

Bleach Plant - C or DO Stage Bleach Plant - EO or EP Stage Bleach Plant - D1 or H Stage

34
Contd..
 Economic Analysis
Investment : 20 Crores
Payback Period : 2.5 Years

35
 Upgradation of Evaporators

Water

I II II I V V
I V I
To hot well

Economic Benefits
Entire Street changed to FF FF at Finisher Stage
Total investment of Rs 6.0 Crores Total investment of Rs 1.5 Crores
Pay back of 6 years. Pay back of 5 years.
36
Technology Improvements Needed

Wood Based Mills

¾ Enhancement in productivity through adoption of advanced production
techniques such as RDH/Super Batch.
¾ New and efficient pulp washing systems should be adopted.

¾ ECF bleaching with ClO2 followed by peroxide is recommended .

¾ Enzyme bleaching should be adopted to reduce chemical cost and
discharge of chloro organics.

¾ Breast roll and blade gap formers improve paper quality and
drainage and are important for Indian raw materials.
¾ A good press section is important in India because fibers are
short. Extended nip is the only good solution for Indian slow
machines. One shoe nip press section would be the best
technology.

37
Technology Improvements Needed

¾ Unsupported web run is normal in Indian dryer section when

speed is higher than 600 meters/min, there should be single
tier dryer groups to avoid web flutter and breaks.

¾ Soft calendar are highly recommended and they could save

bulk and improve opacity, strength and smoothness however
this requires good CD profiles.

¾ Films coaters and on-line calendars are recommended with

good CD profiles.

¾ Soft roll rewinders might be a low cost alternative to improve

roll quality of this paper or coated papers.

¾ Process automation level must be improved.

38
Technology Improvements Needed
Agro Based Mills
¾ Technology improvement is needed for upgradation of quality of baggase
and adoption of efficient washers for straws & bagasse.
¾ Installation of chemical recovery to meet environmental compliance.
Recycled Fiber Based Mills
¾ Inclusion of high density pulpers
¾ For efficient contaminant removal, introduction of high density cleaners ,
turboseparators, fine slot screens and reverse cleaners in the fiber line.
¾ Incorporation of modern deinking cells for production of deinked pulp
¾ Screw press and dispersion system to reduce dirt and specks in DIP
¾ Bleach towers for post bleaching of DIP

Improvements in paper machine area are same as in wood based mills.

39
Newsprint Industry - Issues

¾ Indian raw materials i.e. hardwood, reed, bagasse are not suitable for
manufacturing TMP pulp.
¾ Raw material and energy costs are high for CMP based newsprint mills.

Improvements needed
¾ More use of domestic and imported ONP and OMG for deinking process
to minimise cost of production.
¾ Identify better raw materials like Eucalyptus globulus and E. grandis for
producing chemi mechanical pulps.
¾ There is a need to raise organised plantation of these species.

40
SUGGESTED INITIATIVES
Technology Up-gradation/ Modernization
Modernization Required
Wood Based Mills
¾By and large modernized through its own resources in order to meet CREP requirement,
however the paper machine section need major rebuild up-gradation.
¾Needs restructuring to 1000t/day capacity.
Agro Based Mills
¾Immediate attention required for
pulp washing
paper machine
black liquor handling and effluent treatment.
Recycled Fibre Based Mills
¾Need to be modernized by introduction of
deinking cells
pulp cleaning
slots screening equipment
paper machine rebuilds.
42
ACTION PLAN

43
ACTION PLAN….. Contd…
Government Industry
9 Revision of Forest Policy so that 9 Cooperation with farmers and
Raw Material plantation can be increased. State Forest Dept.
9 Degraded forest lands should be 9 Search for foreign partners.
Wood identified by state govt. and be
9 Public –private partnerships
offered to industry on long leases
of plantations.
9 FDI in plantation programmes
(with no change in land use)
9 Public –private partnerships

9 Long term contract with

Recycled Fibre 9 Allow duty free imports of waste printing/converting waste
paper
9 Global sourcing, foreign partners
9 Encourage voluntary agreements
9 Sorting of imported mixed waste
to increase paper recovery
9 Fibre fractionation to separate
long fibres

9 Restructuring needed due to

9 Equal subsidy be made available quality and environmental reasons
Agro Fibres to paper industry at par with
9 Develop pulping and papermaking
energy subsidy of bagasse
technology based on non-wood
9 Funds for technology fibre.
development 44
ACTION PLAN….. Contd…
Government Industry
9 Allow duty free imports of new and 9 Better access to international financing
second hand machinery/equipment
Finance 9 Seek for foreign partners
for technology upgradation.

9 Focus on R&D to improve quality and

9 Encourage cooperation &
to meet customers requirement.
Research networking inside the forest cluster
and other industries to make the 9 More closure to international
& Development sector more competitive. connections
9 R&D funding should be increased to 9 Closure cooperation and interaction
1% of turnover primarily through between CPPRI & Industry
funding by industry.

9 Better availability and quality of coal.

9 Cogeneration in pulp & paper mills
Energy policy
9 More uniform energy policy by states

9 Uniform policy as regards to non-

Environmental 9 Bigger mills and modernization to meet
biodegradable materials.
environmental standards.
Policy
9 Eco labeling scheme based on
9 Actively participate development of Eco
sustainable raw material base
label schemes so that industry’s can be
(wood/waste paper /agro) and
taken into consideration.
environmental friendly processes.
45
 Conclusions
( Major sections of pulp & paper industry continue to use
obsolete technologies.
( In order to improve its performance in terms of quality of
products, reduce cost of production and to comply stringent
environmental standards, it is important for pulp & paper
industry to initiate technology up-gradation in a phase-wise
manner.
( Technology up-gradation scheme of DoIPP can help industry
to meet future requirements.
Thank You

47