INS seeks increase in government ad rates

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INS seeks increase in government ad rates

Lately the newsprint prices have shot up in India and worldwide. Recently, the government of the United States of America hit the Canadian forestry industry with duties and also held to countervailing duties on Canadian newsprint. In a preliminary investigation carried out by the American authorities, it was found out that Canadian exporters under-priced coated groundwood paper by between 0 and 22.16%.

Uncoated groundwood paper includes newsprint, book publishing and printing and writing papers. It was determined that the Canadian exporters sold newsprint in the US at 22.16% less than the fair value. It was noted that the maximum margin, 22.16% is lower than 54.97% (up to) subsidy rate alleged by North Pacific Paper Company based in Washington, which had earlier made the petition to the department to impose tariffs. It complained Canada was dumping newsprint into the American market and unfairly subsidizing its industry at home. The newsprint prices in the west coast of the United States of America increased from US$ 545 to US$ 605 (August 2017 to January 2018) and increased from US$ 575 to US$ 635 in the east coast in the same period.

The US Commerce department’s investigation began in August 2017, and an International Trade Commission investigation began the following month. This is the second time that the Trump administration has slapped duties on the Canadian forestry industry in recent times. The dumping rate was calculated as 22.16% for Catalyst Paper Corp and all other producers excluding Resolute Forest Products and White Birch, which had zero dumping rates.

On the other hand, according to news outlet Keskisuomalainen, press operators across Europe have run into a shortage of both newsprint and magazine paper. The reason for this shortage is the closure of factories and machines and bankruptcies in forestry companies. With a spike in demand, the paper manufacturers found it difficult to maintain supplies and this led to a 10% hike in paper prices in the past year.

The price hike has also affected the Indian newspaper industry as a result of which it is asking for help from the government. An eight-member delegation of the Indian Newspaper Society met Information and Broadcasting minister Smriti Irani, asking the government to provide immediate relief by increasing the rates of government advertisements such as DAVP ads.

According to an article published on 14 March 2018 by Hindi daily Dainik Jagran, the price of newsprint in India has increased by 40% in the last one year. The same article says that since 60% of the cost of a newspaper is of the newsprint alone, publishers are finding it difficult to raise even half the production cost of a newspaper by its cover price.

The Jagran article says the newsprint cost has increased from Rs. 33,000 a ton till last year to Rs. 52,000 a ton now, an increase by around 40%. Citing the main reason as that of newsprint imports, the article says that half of India’s newsprint requirement is met by imports – of the 28 lakh (2,8 million) tons consumed, only 14 lakh tons is produced by domestic paper companies. Akhila Urankar, president of the Indian Newspaper Society, informed Irani that the way newsprint prices are rising and the rates of advertising are stagnant, it is not possible to produce newspapers.

Apparently, Urankar suggested that since the government advertising rates were last revised in October 2013, increasing government ad rate is in any case feasible. The minister agreed to consider the plea coming from the Indian Newspaper Society delegation.

Based on our queries to some newsprint suppliers in North India, we notice considerable difference in newsprint prices from the figures given in the Dainik Jagran article. Our queries indicate that newsprint prices in India seem to have increased from Rs. 33,000 a ton last year to Rs. 47,000 a ton currently, which is still a significant 42.4% increase in domestic newsprint price compared to last year.

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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