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MARKET
leader Trust International Paper Corp. (Tipco) is not
keen on increasing its capacity even with the possible
supply problems that the local publishing industry might
encounter due to the financial and operational woes of
its competitor Picop Resources Corp.
Alfredo
Chan, Tipco senior vice president, said even if the
company would consider hiking its production output, its
biggest constraint would be the tight supply of waste
paper, which is the main raw material being used by
Tipco.
“There
is no raw material available, so we can’t add on our
capacity even if we want to,” Chan told the
BusinessMirror.
Tipco,
Chan said, is already operating on full capacity. It
accounts for about 53 percent of the estimated 100,000
tons of paper being used by the domestic publishing
industry per year. The rest are shared by Picop, Bataan
20-20 and the small paper manufacturers.
With
Picop encountering operational problems, Chan said Tipco
is now trying to fill up the domestic requirements by
reducing its export to other Southeast Asian countries.
Due to
its export commitments, however, Chan admitted the
company will not be able to supply all the gaps should
Picop fully stop its operations.
Tipco is
exporting 60 percent of its production.
With
this, Chan said they are hoping the government would
intervene and probably stop the export of waste paper,
or at least allow domestic manufacturers to get all
their requirements first before allowing the rest to be
sold abroad.
Miguel
del Rosario, president of the Pulp and Paper
Manufacturers Association (Pulpapel), said the
Philippines is now exporting 5,000 tons of waste paper
per month, mostly to China.
“Compared to last year, the increase is dramatic, and if
this continues, and China is willing to buy anything,
our whole paper industry is in severe danger,” del
Rosario said. He said there is an 80-percent yield from
the waste material to the finished paper.
Picop,
aside from having a capital deficiency of P1.164 billion
as of March 31, 2008, is also having problems with
government regulatory agencies on its virgin pulp
resources, which the company uses as main raw materials.
Chan
said they believe that Picop’s woes will only be
temporary.
“We are
looking at it as just temporary. We are optimistic that
Picop will resolve its problems because they also have
to get back their investments. They cannot leave their
plant just like that,” Chan said.
Tipco,
Chan said, is implementing a staggered 47-percent
increase in its prices on a six-month period ending in
September.
He said
the company is spending more on the purchase of imported
waste paper, which is now about 20-percent higher than
those sourced locally.
Tipco is
hoping, he added, that the government would help in
coming up with a more efficient way of collecting the
waste paper from the junk shops and in reducing the cost
of interisland freight.
Chan
assured the public that with the spiraling of the prices
of paper, it is not giving special preferences to any of
its buyers and is not allowing them to make advance
purchases for long terms, debunking fears that certain
players may be hoarding stock.
“Our
publishers are mature, they don’t do that, and the
company will also not allow that. The company is
avoiding that,” he said. |
