Publishers' union accused PT Aspex of price markup

Publishers' union accused PT Aspex of price markup

JAKARTA (JP): The Association of Indonesian Newspaper
Publishers (SPS) accused newsprint producer PT Aspex yesterday of
setting an excessive price as negotiations to review the price
slid to a deadlock.

Executive director of SPS, Suryatna, said Aspex had included
an expenses hike of more than 92 percent for elements other than
the raw material, into its new newsprint price of Rp 3,545 (68
U.S. cents) per kilogram for sale in the first quarter next year.

"The huge increase of non-raw material expenses does not make
sense, particularly because the costs are not affected by the
fluctuating appreciation of the rupiah against the U.S. dollar,"
Suryatna said.

Suryatna, who represented SPS in negotiations, said both SPS
and publications demanded a maximum price of Rp 2,500 per
kilogram.

Non-raw material expenses include wages, electricity
expenditure, supporting materials, manufacturing expenses,
interest, miscellaneous and sales expenses.

Aspex, which supplies one third of the country's paper annual
demand of 12,000 tons, has announced a Rp 2,014.83 hike from the
old price earlier this month. It said the skyrocketing
appreciation of the U.S. dollar against the rupiah in the past
month was blamed for the price rise.

The paper factory recycles old newspaper (ONP) and computer
print outs (CPO) it imported in U.S. dollars. Aspex said the
material expenses cost an extra Rp 613.71 per kilogram due to the
weakening rupiah.

SPS initiated the meeting with newsprint producers Monday in
response to mounting complaints by the country's publishing
houses about the sharp rise in the newsprint price. A number of
publications shut down in the past month due to the price hike.

Suryatna blamed the deadlock on Aspex's stubbornness, but
expressed his guarded optimism that the dispute would be resolved
as soon as possible.

He said SPS would ask the Minister of Trade and Industry Tunky
Ariwibowo to mediate the disputing parties when negotiations
resume. He did not say when the next meeting would take place.

Business-minded

Director General of Press and Graphics of the Ministry of
Information Dailami called on Aspex to consider cash flow
difficulties now facing the country's publications.

"I suggest that the newsprint company share the burden, rather
than take advantage of the economic crisis," Dailami said after
presenting awards from the Indonesian Journalist's Association to
several journalists and the head of a village in Lebak, West Java
yesterday.

Dailami said the newsprint price should increase due to the
material cost hike.

"But the newsprint company should not set its sight only on
making as much profit as possible. A price hike should not
threaten the national press industry," he said.

He agreed that the government should lift the so-called
monopoly right to a certain company and let the price be decided
by the market.

"This monopolistic practice has given the national press
industry a weak bargaining power in front of newsprint
companies," he said.

He warned that the price increase would hamper the national
reading drive. "Book prices would be more expensive, and many
people would be unable to afford to buy them," Dailami said.
(amd)