Arkhangelsk Raises Board, Paper Prices
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Arkhangelsk Pulp and Paper Mill (APPM), Russia, has increased prices for its product range. Prices for "cardboard" for flat layers and fluting reportedly will rise by 13%, for hardwood bleached pulp by 9%, and for softwood bleached pulp by 17%. At the same time, prices for label paper will increase by 10%, and for writing paper by 5%.
The company noted that the price increases are mainly due to a current crisis in Russia, caused by Western sanctions. The existing investment program will extend through 2017 and is estimated at 15 billion rubles (about $500 million). Half of the investments will involve the purchase of equipment mostly from abroad.
Some of the funds are expected to be used for construction of a new plant for the production of hemicellulose (about 3 billion rubles), reconstruction of two board machines (RUB 2.8 billion), and other projects.
The ever-weakening Russian ruble increases the cost of debt servicing and reduces lending opportunities, according to the company. Currently, the company’s net debt is estimated at 9.2 billion rubles, which is 28.1% more than in 2012.
