Tuesday, August 18, 2009

SCG Paper enters premium market with "ideas"

       SCG Paper, the country's largest integrated paper maker, has launched a new premium product under the "Idea Work" brand and aims to make Bt1 billion from this in the first year.
       The brand was developed in order to diversify the market and meet different customer demands.
       "Despite the slowdown this year, the market of office paper has been growing by 7 to 8 per cent per annum due mainly to the importance of computers in offices nowadays. Moreover, paper has become a tool in building an impressive image," SCG Paper's president Chaovalit Ekabut said.
       The firm currently offers two office paper products: Idea Green and Idea Work.
       "The segments targeted by the two products are clearly differentiated. 'Idea Green' attracts environmentally friendly users, while 'Idea Work' should create a new niche market by serving demands for premium paper products," marketing director Puttaporn Saengratanadej said.
       He added that Idea Green hold a 10 per cent market sharer, and SCG Paper hopes its new product will hold 15 to 20 per cent of the market within a year.
       He added that in Thailand last year, about 200,000 tonnes of office paper, at an estimated value of Bt6 billion, was consumed.
       Chaovalit said the paper industry in the second half should not be any worse than it was in the second quarter of this year, when demand fell by 10 to 15 per cent compared to the same period last year.
       "It is difficult to predict the market situation in the second half because it relies mainly on the global economy.
       However, we believe that we have survived the bottoming out in the first quarter, when demand plunged by 20-25 per cent year on year," he said.
       In addition, he said, the SCG paper plant in Vietnam had been up and running since the second quarter and is expected to produce around 50,000 tonnes this year. The plant has total production capacity of 220,000 tonnes per year.
       Meanwhile, the price of short and long paper pulp has risen by US$100 (Bt3,398) per tonne from the start of this year, so short and long pulp now cost $500 and $600 per tonne respectively.
       Although the price of oil has been on a continuous rise, he said the price of raw materials should not be too affected because it is more controlled by demand and supply.

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