Domestic paper production can no longer compete with imports/ the lack of working capital for production
The 4.1% growth in paper production by the end of July
August 27, 2019
Continued packaging paper exports up to the level of 15%/ domestic consumers need not be concerned about its shortage.
August 28, 2019Domestic paper production can no longer compete with imports/ the lack of working capital for production
In response to the criticisms over the expensive domestic production, the head of the Syndicate of Paper and Cardboard Manufacturers said, “The domestic production was not supported so that it reached 5 percent. Now, there is no longer any working capital for high production and the decrease in cost price.”
In an interview with cultural correspondent of Tasnim News Agency, criticizing the lack of timely support from domestic paper producers, Abolfazl Roghani Golpayegani said, “When the domestic manufacturers sought support for domestic production, paper imports was prioritized. However, domestic production can no longer compete with imports.”
Referring to the foreign currency support for the import of the raw materials of production, he said, “The government allocated a very insignificant amount to the imports of pulp and raw materials of paper production which was only for writing paper and newsprint. Of course, the authorities have taken these measures without consulting with the relevant entities, and it is one of the reasons why a part of the allocated foreign currencies is not clear where has gone.
Responding to the criticisms on the price rise of domestic paper on the market, Roghani said, “The domestic production has sharply decreased compared the past three years, reaching between 10 and 5 percent because it has not been profitable for domestic manufacturer to produce paper. On the other hand, all the foreign currencies at governmental exchange rate were allocated to paper imports. When the paper production is in small scale, low price is not profitable, and we cannot help increasing the price. Therefore, domestic production cannot compete the imports.”
“There is no working capital in paper production industry.” He said, “Most domestic manufacturers do not have financial resources because the working capital has increased from three to four times for production units. The time when our friends and consumers should have supported the domestic production, they did not, and our production increasingly faced difficulties. Now we are expected to put pressure on domestic production which is not possible. There is no doubt that the domestic production should be at the service of consumers, but we have not supported domestic production, and it became weak.
In the end, he said, “If the working capital is provided and if all opportunities are not available for imports, it is currently the time that the domestic production would gain in status and have mass production.”
