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)