Paper recycling plants usually buy their raw material from suppliers. More than often, bulk used paper supplied to the plant contains some significant quantity of water in its internal voids. It may be included intentionally or unintentionally. The price of used paper depends on its weight, thus adding water will help to increase weight and consequently increase the price. In this way, plant owner who purchase the used paper suffers a significant of financial lost. The objectives of our experiment are to establish a calibration curve that correlate between the amount of neutron backscattered and water content, and finally to develop a correction factor that need to be introduced to the measured values of water content. A fast neutron source (Am-Be 241) and a portable backscattering neutron detector were used for water measurement. The experiments were carried out by measuring neutron backscattering from used paper that has been added with different amount of water. As a result, a neutron calibration curve that provides a correlation between neutron backscattering and water content was established.