India may soon face de-growth in newsprint consumption
It happens globally! Newsprint consumption has been steeply declined. More so is happening in North America with 10 percent decline and around 3 percent in Europe. China, which was growing until 2008 Beijing Olympics, is facing 50 percent decline from peak consumption rate. In this scenario, Harish Nagpal, former Vice President–Supply Chain, HT Media Ltd, narrates what the future holds for the Indian market.
When print circulations of big newspapers in Europe and America started shrinking, India was a shinning spot with gradual growth in its printed newspaper market. “It’s a fact that our print media market has been gaining growth over the last couple of decades. It’s because of low consumption base and increase in literacy rate among young generations,” observes Harish Nagpal, adding that the market however has reached a stagnant stage today.
“When it comes to measuring the current volume of newsprint consumption among the Indian newspapers, we see just a little development among the national English dailies in metros. Though many regional newspapers are launching new editions in new cities and towns, it will not add enough growth to newsprint consumption that was estimated as 2.6 million tonnes. As per the current rate of consumption, the figure will be down to 2.4 million tonnes,” comments Harish Nagpal. He adds, “If it continues, India may face around 5-7 percent de-growth in newsprint consumption soon.”
According to Harish Nagpal, there are some general and concrete reasons behind the possible decline in newsprint consumption among newspapers in India. One of them being the rapid introductions of advanced technologies and gadgets in the digital media landscape which change the news consumption pattern of the millennial population. “India will soon experiment new bandwidths like 5G and others which pose a big threat to print media. These new-age technologies are affordable, readily available and handy to young generations who take little or no interest in printed newspapers,” opines Harish Nagpal.
He adds, “Import price of newsprint in India has been down to partially compensate the custom duties applicable since July 6 and also weakening Indian rupee against the US dollar. The volume of imports still remains high owing to almost 50 percent decrease in prices from USD 800 to USD 400 over the last 12 months. This put more pressure on domestic suppliers who were expecting higher price post duty.”
“After all, there is no reason for hike in newsprint price in India in near future. Availability is not an issue now. Indian mills have to compete with the overseas manufacturers. They have to reduce prices,” says Harish Nagpal. Every mill in India cannot compete with the overseas manufacturers, except three leading mills—Emami Paper Mills, Shree Rama Newsprint and Khanna Paper Mill. Only these three can produce newsprint for high speed double-width presses installed at the production plants of major newspaper houses, viz. Hindustan Times, The Times of India, The Hindu, Mathrubhumi, Malayala Manorama, etc.
“According to government records, there are around 122 mills in India which are listed and licensed to make newsprint. But they produce inferior quality newsprint made from recycled materials, such as old newspapers and mixed waste paper, Also none of the domestic mills is able to produce lower basic weight newsprint like 40/42 gsm to compete imported newsprint,” tells Harish Nagpal.
Newsprint grades produced at the most of Indian mills are for low-speed presses, consumed primarily by regional newspapers for inside pages. “The main problem will be when highly contaminated mixed waste paper import is totally banned in India in future, nearly 80 percent of overall demand of raw material in the country should be met locally,” observes Harish Nagpal.
Over the last few years, around 45 percent of newsprint in India has been imported from Russia alone; 30 percent from Canada and the rest from Asian countries or others. Harish points out that Kondopoga (over 300,000 tonnes) and Solikem (200,000 tonnes) are two major Russian mills supplying newsprint to India. Asian countries like Malaysia, Indonesia, South Korea, Thailand and others export newsprint to India without import duties. “India has a treaty of zero duty with South Korea as well. Likewise, there are other countries like Chile which have some preferential arrangement to remit 80 percent duty,” says Harish Nagpal.
Despite all these viabilities and impediments in supply and availability of newsprint in India, overall consumption is not likely to attain what it was expected among the country’s newspaper houses. “With the kind of GDP we are having today, in a real sense, advertisements in print media are not coming as it was before. One of the leading web-offset press manufacturers informed that they haven’t received any enquiry on machines over the last four months,” mentions Harish Nagpal, adding that the de-grown in newsprint consumption in near future is quite certain. He conclusively says that many newspaper press manufacturers these days focus only on niche segment, adding advanced features to their machines for innovative and unconventional printing with which print media will able to gain a new ground.