Newsprint price raised by over 20 percent
Newsprint price raised by over 20 percent
JAKARTA (JP): The price of newsprint will be increased by more than 20 percent to Rp 1,600 (73 U.S. cent) a kilogram next month, a move press executives fear will lead to sharp increases in the price of newspapers.
The increase, which had been largely expected because of soaring international pulp prices, was announced by the Ministry of Information yesterday.
There is more bad news for the newspaper industry further down the road. The price for newsprint will further increase to Rp 1,700 a kilo in May and June.
The price is currently Rp 1,320 a kg.
The government took over the matter of setting newsprint prices after negotiations between the Association of Newspaper Publishers (SPS) and the Association of Pulp and Paper Producers (APKI) reached a deadlock on March 22-23.
"The increases have the approval of both SPS and APKI," according to the announcement by the Ministry of Information.
Director General for Press and Graphics Subrata yesterday presided over a meeting with other government officials and representatives of the two associations to announce the increases. Also attending was Sujata, the Director General for Basic Chemical Industry of the Ministry of Industry, Antara news agency reported.
The increase will be particularly hard on small and struggling newspapers already under pressure from stiff competition from other newspapers, magazines and the onslaught of commercial television stations. Many of them would find it difficult to pass the increase in costs on to consumers without affecting readership.
Subrata said that as part of the deal, APKI has pledged to subsidize the transportation of up to 1,000 tons of newsprint from the plant to the publications' printers for May and June.
He said small, less established newspapers, will be given priority for the subsidy. "SPS will determine the mechanism."
APKI Executive Director Kahar Haryopuspito said after the meeting that the increase had been unavoidable because of the higher costs of pulp. "But compared to the price of newsprint abroad, the price in Indonesia is still cheaper."
Although Indonesia is one of the world's largest pulp and paper producers, its industry uses imported pulp from recycled newspaper as its raw material for newsprint production.
Indonesia's newsprint is supplied by PT ASPAC, which has a monthly production capacity of 16,000 metric tons, and PT Leces with a capacity of 3,000 tons. ASPAC exports part of its product while Leces has recently reduced its newsprint capacity in favor of higher quality paper. Domestic demand for newsprint is put at around 12,000 tons a month.
SPS's Chief of Facility and Management Roesilah Kasiyanto said the publishers' association accepted the price increase.
SPS currently has 284 members but only 20 percent of them could be regarded as established, Roesilah said.
She acknowledged that the increase will lead to newspapers rising their prices charged to readers. "Some newspapers in fact have already raised their prices." (emb)