JK Paper is set to hike paper prices from April to partially offset the input cost hikes, according to a statement from the company.

Mr A.K. Ghosh, Vice-President (Marketing & Sales) said in a statement, the industry is under cost pressure over the last one year due to rise in coal, wood, fuel prices and freight. “Our paper price has been unchanged since April 2011 despite huge cost increase of about Rs 6,500 a tonne during the year.”

Also, the recent decision by the Railways to raise the freight rates by 22 per cent has added to the cost pressure. This will drive up costs of inbound freight and will have a significant direct impact of Rs 850-1,250 a tonne in finished paper.

The freight hike will drive up the transportation costs of raw material such as coal, wood and bamboo and have some indirect impact in the form of increase in power tariffs. The company is confident that the price increase will be absorbed at the market place with the onset of the new academic session in 2012-13.

Meanwhile, according to paper industry sources, all the large paper mills are set to hike prices of printing and writing paper by about Rs 1,000-1,500 a tonne.

The mills are taking advantage of the peak academic season demand.

A leading manufacturer pointed out that the paper prices are at 2010 levels as the hikes totalling over Rs 4,500 a tonne between February and April 2011 were all rolled back in May because of market resistance, low demand and over supply in mid-2011.

Last month the mills announced a hike and one more is in the offing.

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