With more than 70 years of history, Vapi-based Aryan Group is a well-established player in the Indian kraft paper and corrugated industry. The company has a backup team of technically sound persons to develop high RCT paper, along with crucial physical parameters, using the latest in recycled fibre technology. According to Mihir Shah of Aryan Paper Mills, the company’s paper offers "one of the best compression results consistently" in corrugated boxes. With two fully-automatic box plants in Vapi, the company is one of the largest corrugators in Western India. “Our speciality is CS-based cartons with consistent performance. Our paper mill is a huge bonus to help serve our valued customers on time, every time. We have a waste paper sourcing tie-up with one of the largest waste paper balers in the US,” Shah says. At Aryan, the company has developed a small dense forest using the Miyawaki methods. “It is truly an oasis of calm and tranquillity in an industrial environment,” Shah says. “We believe there needs to be a shift for ornamental landscapes to plantations to create biodiverse native habitats in private as well as public projects. This helps not just in fighting of heat island effects but also for groundwater recharge.” Beacuse of its increased commitment towards sustainability, the company has commissioned solar roofing at the paper mill. The mill manufactures 100% certified FSC, FSC mix, FSC recycled and 100% recycled paper. “We believe our strength is a highly competent young team, strong waste paper sourcing, our paper mill and two corrugated box plants,” Shah says. Current challenges Regarding the challenges the corrugated and paper industry is facing across the globe, Shah cites multiple reasons, such as rises in freight and material handling prices, rise in waste paper prices, high cost of labour, lack of working capital, and so on.

The international freight rates are at an all-time high. This has caused waste shipping costs to rise. "There are many challenges in getting container allocations, today. Increase in voyage times due to trans-shipment has been a huge challenge,” Shah says, adding, “Domestic freight is at an all-time high due to the escalation in diesel prices as well as the increased demand. Even internal material handling costs have gone up by 50%, which is significant.” Meanwhile, an increase in the recycling content of the paper in the US and Europe has ensured strong demand and subsequent higher pricing. The starch prices are high. Chemicals prices have also escalated significantly, posing a serious challenge. At the same time, in the last 12 months, labour costs have gone up by 40%. Regarding working capital, Shah says, “Earlier, paper mills adhered to an average credit of 60 to 90 days for coal supplies, which have now been discontinued. The high input cost and resultant high finished paper prices have caused a severe working capital crunch, and mills have to address this challenge. The question box buyers need to ask is how deep is the need for a strong supply chain partner in these challenging times.”

Aryan Paper's paper manufacturing facility​

Paper problems For a corrugator, paper is the biggest cost and thus, paper waste is a critical issue. Shah says, “We have machine-specific wastage reports at both our plants. There is an audit which is conducted at regular intervals to monitor our wastage patterns. KPIs are also linked to wastage control as an added incentive.” However, Shah doesn’t believe with WhatPackaging's assessment that the wastage quotient at an average corrugation plant in India is as high as 14-15%. He argues, “Paper from India is now exported to more than 52 countries. Aryan Paper supplies to more than 15 countries which have far more advanced machines than India. Paper manufacturing in India has evolved. Good paper is available. It is the corrugator’s prerogative to buy the right quality paper.” With the advent of new technologies, where a corrugator line can be run at 300-m/minute, it means a new set of challenges to control the wastage. Shah says, we need to expand our vision. “Some of our export customers run their corrugation plants at 400-mpm without any issues. Our Jagenberg rewinder runs at 1,500-mpm. Good reel build-up, jointless reels, and profile uniformity are the key parameters that would reduce wastage. Also, we should look at the possibilities of standardising four-inch cores for high-speed plants,” Shah says. Above all, a good operator is essential. “We provide on-machine and off-machine training at regular intervals. We also seek help from experts who visit our factory and keep us updated with the latest developments,” he adds. Another major challenge for corrugators is paper cracking. Paper mills have increased the use of starch in paper to increase burst factor and ring crush values. Shah says the issue is about SOPs for a corrugator and converting line in India. “Indian paper works in export geographies with arid atmospheric conditions. Paper conditioning is something which we need to improve. Using the correct creasing attachments for higher strength boards is critical,” he adds.

The corrugation state How does one explain the investment and new projects in the corrugated box industry in the past two years? Shah responds: “We have seen that RMC is normally below 50% in most international markets. We are at significantly higher levels. Value addition is minimal. There should ideally be a consolidation at some point.” He adds, “In an ideal condition, light-weighting would be the way forward. However, we need to factor the challenges due to road conditions and poor handling of the reels. We believe the overall market should grow with the introduction of smaller size SKUs across segments.” Meanwhile, the industry has seen a shift in how contractual agreements are drawn between vendor and client. Shah agrees that there has been a transition in the approach of large buyers and A-Lister brands. “The strength of the supply chain was effectively tested during the first lockdown,” he says. “We resumed our corrugated box production within a week. I think Aryan was one of the very first ones to do so in Western India. Our paper mill has been providing price plus supply stability during the many ups-and-downs in the past 18 months.” With the increase in modern retail, Shah believes high-quality graphics printing will come into play. However, this will need to evolve over time. “Digital printing is the need of the hour,” he says. “The current digital printing solutions will significantly help cater to requirements of PDQ, CDU and FSDU display units. The challenge is the high ink costs. Most machine manufacturers have ink-locking systems. This makes it difficult to offer a cost-effective solution to the customer.” Finally, Shah believes the fruits and vegetable segment will be a driver with modern retail and a thrust towards export. “Paper mills will need to develop solutions especially for cold storage applications which have seen goodish growth,” he concludes.

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