Valaichchenai paper mill to reap profits

By Gamini Warushamane

The Valaichchenai paper mill will begin to earn profits from next month. This achievement has been made possible after a lapse of 21 years, with production reaching 500 tonnes per month, said the Competent Authority of the National Paper Company Limited (NPCL), Mangala Senarath.

Mangala Senarath

The company has solved the biggest obstacle to production increase - the boiler. This was repaired this month, he said. Senerath said that due to the malfunctioning boiler, production was limited to 14-18 hours per day.

The boiler was repaired by a local company in Polonnaruwa at half the price of the lowest bid quoted by reputed companies.

“They have done an excellent job and given a 10-year warranty”, he said. From June this year production would be increased by 100 tonnes a month and the mill will reach full capacity. During the golden era of the factory, it produced 1,600-1,700 tonnes of paper and board per month.

“I am proud of taking the first challenge and turning the company around in a short period of one year to a profit-making enterprise.

The former Secretary to the Ministry and Chairman, State Resources Management Corporation, Dr. Willie Gamage supported this endeavour from the beginning,” he said.

He said that the Treasury and other government agencies were reluctant to invest money to renovate the factory, the largest manufacturing facility in the East coast of the country.

“The Ministry of State Resources and Enterprise Development took a bold decision and innovative action to achieve this goal.

The support of trade unions is the biggest strength in this renovation process and today 99 percent of the workers support the changes taking place in the company,” Senarath said.

“During the past two months the factory was closed for boiler repairs but the company was able to pay the salaries of the workers.

After production hits 650 tonnes, we will pay a bonus and other incentives to the workers. From next month, uniforms will be provided to employees. A welfare shop will be opened in the factory premises for the benefit of employees,” he said.

With the increase in production, the company will face two problems - shortage of the main raw material, waste paper and selling the output.

NPCL will set up an islandwide collecting network to collect waste paper and seek government support to discourage the export of waste paper.

In 2012, approximately 300,000 tonnes of waste paper was exported.

The company hopes that its products will compete with imported paper products as the quality is equal to imported paper.

Senerath said that the Government is one of the main users of paper and he expects to increase the supply of paper to government institutions. At present only three percent of the government's paper requirement is supplied by NPCL.