With the revival of the paper industry, TNPL is expected to do much better in the second quarter than it did in the first. The paper industry is expected to revise prices upwards in October or November as there are not sufficient stocks in the pipeline.

According to TNPL officials, a comfortable floating order position to the extent of six weeks is being maintained for sometime. The market has absorbed the existing supply levels and the demand is again growing.

In the last quarter, the highest production was in the month of May for 14,948 tonnes, the capacity utilisation being 100 per cent. In July production touched 14,982 tonnes, the demand coming more from printing and writing paper for 11,982 tonnes.

While August saw an increase in the production of newsprintby 900 tonnes to 4091 tonnes, TNPL will remain content in servicing existing orders in this segment and concentrate more on printing and writing paper where the demand is more buoyant.

Exports have also gone up. TNPL exported 3,480 metric tonnes of paper in August. For the period April to August this fiscal, 4,274 tonnes were exported, while the total exports stood at 5,608 tonnes last year. The company has improved on exports to existing markets of Sri Lanka and Dubai and acquired new markets in the Philippines, Australia and Indonesia. Export prices have also gone up by $70 between April and now and are ruling close to $630-650 per tonne.

The Tamil Nadu government is due to disinvest in TNPL by December this year, from the existing 35 per cent to 26 per cent. This is in accordance with the World Bank covenant when the company had applied for a loan for expansion from 90,000 tonnes to 180,000 tonnes. However, the state's decision is not yet known in the matter. The disinvestment should have been throughone year after the expanded capacity went on stream in January 1996, but the government had then asked for an extension on account of poor market conditions. The company had recently concluded a wage settlement with its union for the next four years. Workers are expected to be benefit on an average by Rs 850 a month.