Market Prices & Forecast
Executive Summary
- The Paper and Paperboard market in April’26 is characterized by a cost-push driven uptrend, with prices witnessing a sharp increase driven by rising input costs and ongoing geopolitical disruptions impacting global supply chains. Kraft paper and duplex board prices have increased by ₹3–4/kg, reflecting the pass-through of higher wastepaper, energy, and freight costs.
- Raw material prices, particularly imported wastepaper, continued to firm up amid supply tightness, while domestic prices stabilized at elevated levels, indicating demand resistance. At the same time, energy costs remain high, with elevated coal and power costs further pushing production expenses upward, resulting in margin pressure across mills.
- On the demand side, consumption has started showing signs of softening, as higher prices weigh on domestic demand, especially in price-sensitive segments. While seasonal demand supported the market in earlier months, the post-season slowdown and cautious procurement behavior are now becoming evident.
Critical Analytics
- Geopolitical disruptions & freight volatility (Red Sea / Hormuz, BDI): Continued tensions remain a key driver of elevated freight rates and supply chain uncertainty, directly impacting imported wastepaper costs and keeping landed prices volatile
- Wastepaper price dynamics (Imported vs Domestic): Imported prices remain firm due to supply tightness, while domestic prices have stabilized at elevated levels—monitoring this spread is critical to assess cost pass-through and procurement strategies
- Energy cost trends (coal, power tariffs): Elevated coal prices and recent power tariff hikes are sustaining high production costs, making energy a key determinant of mill margins and pricing decisions
- Demand-side signals (FMCG, packaging, exports): Early signs of demand softening, especially post-season and in export-linked segments, will be crucial in determining the sustainability of recent price hikes
Outlook: Paper and paperboard prices are expected to stabilize with a slight softening bias in the near term, as the sharp cost-push rally seen in March–April begins to ease. While input costs—particularly wastepaper and energy—remain elevated, improving availability of raw materials and easing supply constraints are likely to limit further upside. Demand is expected to soften in AMJ’26 due to higher price levels and post-season slowdown, leading to cautious procurement by buyers. However, as supply chains normalize and demand gradually recovers in JAS’26, prices are likely to stabilize and witness gradual recovery, supported by improving packaging demand and export opportunities, keeping the overall market balanced between cost pressures and demand-side resistance.