The Hindu Business Line : Rains hit Chennai's corrugated box units

MORE than half the corrugated boxes making units in Chennai have been hit by the heavy rains, resulting in a shortage of packaging materials for manufacturers, according to box makers.

The President of the South India Corrugated Box Manufacturers Association, Mr Dilip Saboo, said over 30-40 units of the total of over 60 box-making units have been hit by waterlogging.

The units are located in the industrial belts in Mugappair and Ambattur, areas where there has been severe waterlogging following the rains during the last week of October. The rains last weekend further aggravated the situation, he said.

Kraft paper (the raw material) and corrugated boxes have been extensively damaged. Mr Saboo said that the units have not been in production over the last one week. Following Sunday's rains, they would not be able to start production for another one week. Power supply is yet to be restored in these units.

He said that initial estimates show that at least half the monthly production of about 2,500 tonnes of corrugated boxes would be lost (a supply shortage of about 1,000 tonnes for those needing packaging materials.)

The owners of box-making units are busy with insurance-related work and are readying funds for restoration. Small manufacturers and exporters needing specialised boxes are most likely to be affected by the short supply of packaging material. Large players such as those in engineering and pharmaceuticals usually hold more than a week's supply. But some of the garment manufacturers needing specialised packaging and food products exporters who hold a few days' supply could find it difficult to source packaging boxes, said Mr Saboo.

Another manufacturer pointed out that the losses occurred because these materials could not be salvaged like other durable products. Once the kraft paper or finished products get wet, they can only be treated as scrap.

The representatives of the Ambattur Industrial Estate Manufacturers Association said that the corrugated box manufacturers were among the worst hit. Rolls of raw material and finished boxes have been damaged.

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