Paper exports dip on the back of robust rupee

The domestic paper industry is beginning to show signs of the impact of the robust rupee. Paper exports have started declining while cheaper imports have led to a correction in coated paper prices domestically.

"Prices of coated paper in the domestic market have come down by about 8 per cent in the last two months, predominantly because of the rupee's appreciation. The rupee factor has made imports cheaper, thereby leading to a correction in domestic prices. Depending on the price outlook, we may regulate production of coated paper in the future," said JK Paper Managing Director Harsh Pati Singhania.

The market size of coated paper in India is about 3 lakh tonnes. Of this, about 70,000 tonnes is met through imports while two leading paper companies "" Bilt and JK Paper "" produce the rest.

"Worldwide softening in coated paper together with the rupee appreciation has a reflection on its domestic prices. The short-term outlook for coated paper is flat though it is likely to remain bullish in the long term," Bilt Managing Director R R Vederah said.

The rupee appreciation has also led to a significant slump in the country's paper exports.