Pandemic and disrupted collections drive Indian scrap paper price surge

The second wave of the pandemic in India and intermittent lockdown since last March have triggered a doubling of waste paper prices and acute shortage of the feedstock for domestic mills.

According to trade sources and the Indian Agro & Recycled Paper Mills Association (IARPMA), prices have surged to INR 22-26 per kg (EUR 0.25-0.29 per kg), compared to pre-Covid levels of INR 10-13 per kg (EUR 0.11-0.14 per kg ). Scrap paper mills account for 17 million tonnes out of the 25 million tonne domestic annual paper production.

IARPMA called on the Government to intervene, accusing suppliers were taking advantage to push up prices. On the contrary, trade circles attribute the surge in prices to disruptions of the supply chain.

Geeta Trading Company, a leading paper recycler and trader based in western state of Gujarat, said that the supply chain disruption creating shortage and rise price had been aggravated by the unorganised nature of Indian waste paper collection.

The informal waste paper sector  or ‘post -consumer paper’ collection is dominated by rag-pickers and vendors/collectors who move door-to-door buying waste paper. Their activity accounts for over 95% of total recyclable waste.

However, with most of such collectors being migrant labourers from rural areas, pandemic and lockdown restrictions forced such labour to return home. Since they account for the bulk of collections, their absence from the supply chain has created acute disruptions in supplies, one trader said.