[🇧🇩] Pulp and Paper Industry in Bangladesh

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Source : https://www.PKDefense.com

Meghna Group of Industries: Bangladesh’s leading conglomerate with a USD 3 billion turnover​

Started in 1976, one of Bangladesh’s largest industrial conglomerates, Meghna Group houses more than 50,000 employees, 6,300 distributors and 15,000 suppliers under its umbrella, with an annual turnover of approximately USD 3 billion. The group boasts of a production capacity of 1200 TPD, with 100TPD tissue production, 800 TPD industrial grade production and 300 TPD writing and printing paper production. The group holds a broad array of industries including FMCG, building materials, pulp and paper, LPG, feeds, fiber, power plants, shipping, seeds crushing, chemicals, ship building, dockyard, securities, insurance, media, Foil packaging, ceramics and aviation. In a recent interview with Paper Mart, Md. Yearul Islam, General Manager (Sales and Marketing), shared about the company’s paper mills, production capacities, expansion plans and current challenges for Bangladesh’s paper industry.

From Left: Md. Yearul Islam, General Manager (Sales and Marketing), Meghna Group of Industries

Paper Mart: Please give us a brief overview of your company.

Md. Yearul Islam: Meghna Group is the leading conglomerate in Bangladesh, with more than 40 sister concerns present under the group. Currently, our yearly turnover is approximately USD 3 billion. We are the leaders of industrial grade paper in Bangladesh, and the pioneer for the export market of the industrial grade. We already supply our papers to China, Sri Lanka, India and many other countries contact us for paper requirements because they like the quality of our products.

PM: Kindly shed some light on your paper mills, outlining the grades manufactured and their capacity.

MYI: We have 5 paper mills. Two mills are for tissue production, with a per day production capacity of 100 metric tons. In these mills, we produce all types of tissues, like napkins, scented tissues, toilet paper, facial tissues and others. Our company has a very good market for tissue paper. We already export to different regions like Africa, Middle East, Nepal and India. Other than this, we have mills for industrial grade paper, with 800 metric tons per day production. In these mills we produce fluting paper, liner paper, kraft liner paper, white liner paper, NCR paper and art paper. We also produce all types of writing and printing paper from 40gsm to 170gsm with 300 metric tons per day production. We plan to expand our business to duplex boards, Swedish boards and simplex boards.

PM: Please tell us about the raw material being used for tissue paper and industrial grade paper production. What are the challenges faced in obtaining raw material?

MYI: All the raw material we use for tissue paper and writing and printing paper is 100% imported. Writing and printing paper as well as tissues are produced using 100 percent virgin pulp. Industrial grade production uses 100 percent waste paper. Depending on the type of industrial paper we produce, we use various categories of raw materials like, NDLKC, OCC and NCC.
With regard to challenges, Bangladesh is currently suffering from a double crisis, with the value of the dollar being very high and the value of taka decreasing day by day. So it is difficult for the owner of the paper mills to import raw materials. If we collect raw materials locally, we will not face such problems. Every paper mill faces the same problem which hampers their production. Since more than 100 paper mills perform their operations in Bangladesh, raw materials are priced very high in Bangladesh. Therefore, we are facing a crisis of raw materials.

PM: How do you feed power requirements for your paper mills?

MYI: In order to meet the power requirements of our mills, we have our own power plant supplying electricity. Our power plant generates almost 35 megawatts of electricity.

PM: Please give us your insights on the paper industry in Bangladesh.

MYI: The tissue paper market is expanding every day and bringing more opportunities. Currently, we have approximately 25 percent share in our local market. For the writing and printing paper market, we have approximately 10 percent share and for industrial grade paper, we occupy 30 percent market share. For industrial grade, we have a big opportunity to grow since many packaging companies import paper from Bangladesh due to our good quality. In the next 2 to 3 years, the company will focus on creating high quality paper and increasing our market presence.

PM: What are your company’s future plans for the paper business?

MYI: The group will expand 3 to 4 more concerns in industries like steel, glass and paper. The management will also try to invest more in the paper sector like duplex boards, writing and printing, and tissue machines. We will try to increase the volume of the paper manufactured in future depending on the market conditions at that time. Therefore, we aim to expand our presence in the paper market, not just in Bangladesh but also to export to South Asia, Middle East, and Africa and European countries.

 

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Bangladesh-based City Group ventures into Tissue Market, orders a new tissue line from Toscotec​

The AHEAD 2.2 tissue line of Toscotec has a design speed of 2,200 m/min and a production capacity of over 40,000 TPA. City Group has ordered an extensive service package including YES-CONNECT-VISION Augmented Reality remote assistance system.​

Bangladesh-based City Group has ordered an AHEAD 2.2 tissue line on a turnkey basis from Toscotec. With this expansion, the Bangladeshi consumer goods manufacturer sets out to enter the tissue market. The new tissue mill has been erected in Hoshendi Economic Zone near Dhaka. The production started in 2023.

The AHEAD 2.2 machine has a design speed of 2,200 m/min and a production capacity of over 40,000 TPA. It is designed for superior drying efficiency through the combination of the latest generation design of both TT NextPress shoe press and TT SYD Steel Yankee Dryer, as well as TT Hood with multistage energy recovery.

The turnkey supply encompasses the complete stock preparation and fiber recovery systems, the patented TT SAF® Short Approach Flow with double dilution, the full electrification plant, Toscotec’s proprietary control system, and all associated auxiliary systems. Toscotec will also deliver the new OPTIMA 2200 slitter rewinder designed to preserve the bulk and softness of the mother reel.

Md. Imran Uddin, Director of Planning & Business Development at City Group, says, “When we set out to enter the tissue market, we did a careful evaluation of machinery manufacturers at global level looking for a supplier of turnkey projects who could also provide all the assistance we needed to succeed. We decided on Toscotec because they offered the highest guarantee of advanced technology and wide experience in giving full-on support to newcomers in tissue.”

City Group ordered an extensive service package including detailed engineering, erection supervision, training commissioning, start-up assistance, and YES-CONNECT-VISION Augmented Reality remote assistance system.

Gabriele Martinelli, Toscotec Sales Manager, says, “It is always exciting for us to take on a project of a company entering the tissue market. This is the second turnkey project in two years in Southeast Asia. We are happy to share our experience with City Group through technical meetings, visits to our workshops, and to paper mills operating Toscotec’s tissue lines. We knew it was important for them to look at key components such as TT SYD and TT NextPress, and then see them in operation.”

 

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A.Celli Starts up Complete Turnkey Tissue Plant at Partex Star Group in Bangladesh​

The Tissue line supplied by A.Celli Paper produced its first Jumbo roll in December 2021 with full satisfaction of the customer.​

January 20, 2022

Partex Star Group is one of the largest Bangladeshi private sector enterprises.

A.Celli Paper has successfully started up the turnkey Tissue plant supplied to Partex Star Group in December 2021.

The line, installed for the production of bulky and soft Tissue with high levels of absorbency, includes a low-consumption complete stock preparation from 100 percent pure cellulose pulp, the “Control and Automation System”, the ancillary services and the field equipment.

The scope also includes a new iDEAL® Tissue machine with a width of 2800mm at the pope reel and a maximum operating speed of 1800 m/min, a 15-foot forged steel Yankee Dryer, an E-WIND® T100 three-ply Tissue slitter rewinder and, finally, a reel handling system.

Mr. Shamsul Arefin Chowdhury, the collaborator of A.Celli Group, says, “It was extremely satisfying to produce the first Jumbo Roll with A.Celli Tissue machine. We at Partex Tissue Ltd. would like to thank A.Celli for the state-of-the-art technology and services they provided us with, which allowed for a wonderful start up without any sheet breaking. All of this was possible despite the COVID 19 pandemic situation and the consequent limitations.”

 

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New Paper Mills Give Boom to Domestic Paper Production in Bangladesh​

Around 18 to 20 new paper manufacturing units commenced production in last five years which has helped mitigate the country’s import dependence, strengthening the sector.

At present, there are 72 paper mills in the country out of which the lead manufacturers in the private sector include mills of Basundhara Group, Partex Group and T.K. Group, etc.

Substantial increase in domestic production of paper due to setting up of new factories has resulted in gradual decline in import dependence. Around 60 per cent of the annual demand that is half a million tonne is being met by the local factories. These new manufacturers produce only white or news print papers which have increased the dependency on import of high-end papers such as art papers, art cards, Swedish boards, duplex boards, and brown papers to meet the rest of the demand.

Additionally, the need for policy support and ensuring uninterrupted supply of gas and electricity is required to motivate the companies to manufacture high-quality paper, unveiling some unique opportunities for the country.

At present, there are 72 paper mills in the country out of which the lead manufacturers in the private sector include mills of Basundhara Group, Partex Group and T.K. Group, Sonali Paper Mill, Meghna Pulp & Paper Mills Ltd, Creative Paper Mill, Capital Paper Mills Limited, Hakkani Paper Mills and Hossain Pulp & Paper Mills.

 

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Bangladesh's paper industry holds huge export potential​

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Bangladesh paper industry, which now markets its products in some developed countries even, holds huge potential for boosting export if over half of its dormant production capacity is used to exploit unfolding global trade.

Industry people express such view as the paper-manufacturing segment of the paper sector in the country, which was once mostly dependant on import, now looks to widen its footprint on the international market amid some fortune change.

Paper-sector entrepreneurs, as such, regret that some government offices still nurture a penchant for foreign papers imported by spending hard-earned foreign currencies.

They noted that the local manufacturing gradually increased and shifted to the private sector from the state-owned mills as they aggressively adopt modern technologies to make high-quality papers.

Currently, there are around 70 private paper mills operating in the country, out of 105 registered with government.

Some of those in operation are, however, enhancing their capacity with new variety of paper products to cater modern-day needs at home and abroad.
Paper and paper-goods sector includes writing and printing paper, offset paper, newsprint, tissue and packaging paper.

According to data available with the Bangladesh Paper Mills Association (BPMA) the country's paper-market size is around Tk 50 billion, registering an annualised growth of over 5.0 per cent in the recent times.

Local known demand for paper products is around 0.6 million (six lakh) tonnes despite there being a capacity of producing 1.5 million tonnes annually. However, nearly 0.3 million tonnes of paper is also imported in addition to local manufacture.

Currently only one state-owned company, Karnaphuli Paper Mills, is operating, on a limited scale, though. Two other mills-in Khulna and Pabna-owned by Bangladesh Chemical Industries Corporation (BCIC) have suspended their operations, a BCIC source said.

Private paper-millers' journey in Bangladesh began around three decades ago on the back of a growing demand for paper products in the country, General Manager of the BPMA AKM Naswsherul Alam said.

"Paper and paper products are bringing in new possibilities for Bangladesh as countries like China are shifting such industries from there to other countries due to rising production cost and environmental concern," he said.

However, higher production cost is one of the key challenges in expanding the sector's stake in the export basket, he said, adding that Bangladesh now exports paper and paper products to over 50 countries, including the United States.

According to data available with the Export Promotion Bureau (EPB) the country earned $27.39 million in the July-November period of the current fiscal, which is 15.3 per cent higher than that of previous period. Exporters enjoy 10-per cent cash incentives.

As per data available with Fortune Business Insights, an international think-tank, the global paper and pulp market is projected to grow from $351.51 billion in 2021 to $370.12 billion in 2028 at a CAGR of 0.74 per cent. It also says globally annual per-capita paper consumption is around 55 kilograms.

Managing Director (MD) of Asia Paper Mills Limited Abdul Jabbar Khan predicts paper products' demand will continue to rise despite its form changes.

"Packaging paper's market is growing fast in Bangladesh, as well as across the globe, indicating huge prospects for local mills," says Mr Khan, thereby underlining the urgency of tapping the country's latent capacity of production and marketing.

Either a lifestyle or consumer items, almost every sector needs packaging materials, thus creating demand for paper items, adds the company MD, who is set to revamp his plant with a 100-tonne-capacity machine.

Industry-insiders say a huge amount of copier paper or offset paper is used for print and photocopy at the offices and academic purposes, having a market of Tk 6.0 billion a year.

However, the disruptive Covid-19 pandemic dented the growing demand amid lockdowns and restrictions.

"The demand is yet to get back to the pre-pandemic situation as educational institutions are not running in full swing," said General Manager of Papertech Industries Ltd Md Kamruzzaman.

Highlighting the quality of local paper and their acceptance to local consumers, he said some government agencies still depend on imported paper, and that is a challenge to the local manufacturers.

In their procurement documents, many government offices specifically mention two foreign brands, skipping scopes for equivalent local brands, thus the local brands cannot participate in the bidding.

"They (government offices) could mention equal standards so that we can also participate," he said, stressing fair deals in the trade.

Mr Zaman said a number of renowned organisations like Bishwo Shahitto Kendra now use the local brands' paper for their printing purposes.

Bangladesh's leading paper manufacturers include Bashundhara, Meghna, Amber, Papertech, Sonali and Magura. Around Tk 700 billion (70,000crore) has been invested in the sector so far.