Professional Documents
Culture Documents
Raffia
CONTENT
Highlights
Polymers
Polypropylene
Building Blocks
Polymers
Cement 38
FIBC 19
Sack Exp 9
Foodgrain 6
Lamination 2
Others 26
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4Basic price per bag Rs.17.05 (Average of last 5 Rs.10.44(incl. of 16% excise
(excluding sales tax) months & incl. of excise duty) duty & freight)
8Aeration Good
PLASTIC WOVEN SACKS VS JUTE WOVEN
SACKS
9 Problem/Quality Supplies are generally not strictly Good, no mould, cake formation,
complains as per delivery schedule and have condensation or musty smell on
been carried over to next months rice, wheat Raw material available
in the past in spite of pre- in plenty. No disturbance in supply
inspection by Quality Assurance schedule. The quality checks may
Wing of DGS&D complaints about be easier to enforce on PP bags
poor texture of bags leading to and the possibilities of bags
spillage of grains and variations in getting damage by water/ rain
length /width of bags are there. during transit will be lesser.
Besides complaints about
damage by water/ rains during
transit are also very frequent.
• No. of player – 54
• Capacity-215 MMT
• Large cement plants-136
• Mini cement plant-382
50
100
0 0
2004-05 2005-06 2006-07 2007-08 2008-09
END USERS
Threats to Polypropylene Consumption
Opportunities
• Growing Infrastructure
• Government norms
• Opportunities in rural market
END USERS
B. Fertilizer industry
Installed capacity – 184.2lakhs MT/Annum
Out of which 124.61lakhs MT is for nitrogen and 59.59lakhs
MT is for phosphate.
No. of fertilizer plants
Large size: 57
Small and medium size: 78
Manufacturing
units
Sr. No. Sector Capacity (lakh MT) Percentage share
cost analysis PE PP
raw material cost/MT 69.4 61.3
cash discount 0.6 0.6
68.8 60.7 Note:
excise duty+ E Cess 0.082 0.082 • To a processor QD & AQD along
74.4 65.7 with MOU discounts are also paid. If
trade discount 2.0 3.0 we want to calculate exact cost of
72.4 62.7 production then the same also need
to be deducted from resin price
per kg cost 72.4 62.7
afterwards.
Bag costing
raw material 0.88 0.88
63.7 55.2 • Also we have not assumed price
filler Rs26/kg 0.12 0.12 differential of LLD/LD or PP/L/LLD
3.1 3.1 being used for lamination of between
conversion cost 13.0 13.0 the 20-25g. This is virtually very low.
cost/kg 79.8 71.3
• While quoting price customer will not
U.V. Stabilizer cost 0.0 1.5 pass on the cash discount & TD to
cost/kg 79.8 72.8 processor hence his quote will
increase by that amount too.
weight of bag 128.0 117.0
• Current domestic food grain and pulses production is 470 million tones
• Rice and wheat contributes 77% of total food grain production.
• 30-40% food grains is procured and stored by Govt. agencies and rest by
private operators.
• Loss due to poor storage is as high as 5%.
• About 30-40% of the grain produced in the country is stored by Government and
private agencies.
• 60-70% is retained by farmers for household use and consumption.
• The loss of food grains stored by Govt. agencies is less than 1%. But at the
farmers end it can be as high as 5% as a national average.
Reasons for not using Plastic bags for packaging till date
OPPORTUNITIES THREATS
• Exports provide a sound market. •Poor quality of product might affect good
export potential
• Poor showing of jute industry.
International fluctuation in petroleum products
• Increasing production of cement, fertilizers etc. affects industry
Food grain sector can be a huge market
High dependency on labors
PORTER'S FIVE FORCES MODEL
• Overall, for most of manufacturers, quality of the raw material does not play
an important part. Main factors they consider while choosing raw
material is cost and availability
• Demand for raffia grade for plastic woven sack application is expected to
grow at a CAGR of 9.2 percent to over 721.842 tones
CONCLUSIONS
• The quality of the raw material should be increased as exports are opening
up