Analysis of the impact of the rising price of the

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Analysis of the impact of rising paper prices on newspaper business

from the fourth quarter of last year, domestic paper prices began to rise sharply, from 4300 yuan per ton in April 2007, and continued to rise. At the end of last year, the market price was between 4800 yuan and 4900 yuan, rose to about 5400 yuan in March 2008, and rose again to 5900 yuan in June. At present, the price has reached about 6000 yuan, with a total increase of more than 40%. The price rise of paper is the highest in the past five years, and this situation still has a continuous trend. The sharp rise in paper prices has had a significant impact on the management of newspapers in China. According to the statistical data of the "basic situation of the national publishing industry in 2007" released by the General Administration of publication on July 21, 2008, the total number of printed pages of books, periodicals and newspapers published nationwide in 2007 was 234.52 billion, equivalent to 5.427 million tons of paper, an increase of 1.61% compared with 2006, of which newspaper paper increased by 45.60% year-on-year, accounting for 72.08% of the total. It is estimated that the newspaper industry will use more paper this year than last year. Faced with such a huge amount of paper and rising prices, major newspaper groups and newspapers complain endlessly

sharp rise in paper prices and analysis of the reasons

the main reason for the rise in paper prices is that in 2008, major changes have taken place in the relationship between supply and demand in China's paper market. Many factors, such as the rapid rise in the price of raw materials for papermaking, the rise in the price of energy supply and logistics transportation, and the high cost of environmental protection, have led to a strong rebound and sharp rise in paper prices

the price of main raw materials remains high. In terms of cost, papermaking raw materials mainly rely on imported wood pulp and waste paper, and the prices of these two raw materials are rising. The main raw material of paper production is waste paper, and more than half of the waste paper used by Chinese enterprises depends on imports. At present, the sources of waste paper used by domestic paper mills are the United States, Japan, Europe, domestic, etc. among them, the quality of waste paper in the United States is the best, thus forming an adverse situation that domestic paper mills almost all use American waste and compete to buy American waste. Most domestic paper mills use American waste as the main raw material, while the annual supply of waste newspapers in the world has decreased year by year, and the supply and demand of American waste is unbalanced. As a result, the price of American waste has risen again and again, from $135 per ton at the beginning of last year to $315 per ton now, and the rising trend is far from the inflection point. Domestic paper manufacturers have completely lost their price initiative and can only be manipulated. More seriously, driven by American waste, the price of waste paper in other regions has also increased, and even the price of domestic waste paper has begun to rise, reaching 2600 yuan per ton. The shortage of main raw materials and rising prices will further increase the pressure on paper prices

the demand for paper in the international market increased, and the export of domestic paper increased. After China's accession to the WTO, the trend of economic globalization has made the domestic market of paper more and more related to the international market, and the impact of the international market is more and more direct. After years of development, the domestic paper production capacity has formed a certain scale, and the quality and price are gradually recognized by international users. At present, the export price of paper per ton is 910 US dollars, equivalent to about 6300 yuan, higher than the domestic price, and is still in the rising stage. Although the domestic market of paper has risen to 6000 yuan per ton, if you want to know more details about the experimental machine, the export profit is still higher than the domestic sales. Driven by interests, major paper mills continue to increase the export volume of paper, resulting in tighter supply in the domestic market and rising prices

small and medium-sized paper mills withdraw from the paper market competition. The state has strengthened environmental protection supervision, forcing some small and medium-sized paper mills with backward production capacity and difficult to meet energy conservation and emission reduction standards to withdraw from market competition, and some capable paper mills have switched to cultural paper. For example, 234 of the 236 small and medium-sized paper mills around Dongting Lake in Hunan Province alone were forcibly closed, and the situation in other parts of the country was also similar, so that the total supply of paper fell rapidly

the transportation prices of coal, electricity and oil are running high, and the transportation cost increases. Since the beginning of this year, the high transportation prices of coal, electricity and oil, the continuous increase of environmental protection costs, the overall increase in the prices of chemical raw materials, fuel oil and other energy and the tight supply have greatly increased the cost of papermaking, prompting production enterprises to transfer the burden to paper users

the Olympic Games has increased the use of paper and made supply and demand more tense. In order to prevent traffic control in Beijing during the Olympic Games, major newspapers in Beijing have piled up a large amount of paper before the Olympic Games, exacerbating the tension in the domestic paper market. In particular, the profit orientation that the export price of paper is higher than the domestic price makes many manufacturers sell paper abroad, resulting in the reduction of domestic paper sales

in addition to the above reasons, the coordinated price rise of several major domestic paper mills is also an important factor to promote the price rise of paper. Some paper mills lack integrity and do not supply according to the original commercial contract. In the environment of rising paper prices, they unilaterally tear up the contract or refuse to supply paper on the grounds of lack of raw materials and shutdown, which worsens the business situation of the newspaper industry

the difficulties and impact of the rise in the price of paper on the newspaper industry

due to the particularity of media management, it has certain difficulties in price transmission. The transfer of costs to the downstream is not as fast as industrial enterprises. As the most important cost component of newspaper management, the rise in the price has a huge and very direct impact on newspapers

the revenue and expenditure of various newspaper groups and newspaper agencies are seriously unbalanced, and the capital chain is tight. The rise in paper prices and the downturn in advertising have directly led to a serious imbalance in the revenue and expenditure of newspaper groups. For example, the expenditure of Jiefang newspaper group in 2008 will be 100million yuan more than that in 2007. Shenzhen newspaper group uses 70000 to 80000 tons of paper every year. This year is the Olympic year, and the consumption may be even greater. According to the current paper price rise trend, the cost will increase by nearly 100million yuan. Guangzhou newspaper group estimates that the cost will increase by more than 200million yuan. While the paper industry is raising prices substantially, it has put forward new requirements for the arrival rate of paper money, and some even require cash delivery, which directly affects the cash flow of the newspaper industry and the competitiveness of the newspaper industry in the market. Some newspaper groups were originally going to restructure and list their operating parts, but this year they are facing a severe situation of possible losses, causing them to postpone the listing time

the newspaper industry is likely to face losses in 2008. The sharp rise in paper prices has led to a rapid rise in the cost of newspaper groups and offices. According to statistics, the consumption of paper in China in 2007 was about 3.5 million tons. Due to factors such as the Olympic Games this year, it is estimated that the consumption of paper in 2008 will increase by 8%, about 3.8 million tons. Among the production costs of newspapers, the cost of paper accounts for about 60% - 70%, and the impact of paper price increases on newspapers is obvious. Based on the annual paper consumption of 3.8 million tons in China, the current price of paper per ton has increased by nearly 2000 yuan, which means that the newspaper industry will bear at least 7 billion yuan more paper costs than last year. In 2007, the profit of the whole newspaper industry was 5.905 billion yuan. Even if the profit growth of 10% - 20% in the whole year is not enough to offset the growth of paper price. If the current situation is maintained, the newspaper publishing industry will face the risk of general losses in the whole industry in 2008

directly affect the influence, competitiveness and public opinion guidance ability of party newspaper groups in the diversified communication pattern of the market. The newspaper industry has the dual attributes of ideology and market. The purpose of building newspaper groups is to form a strong ability to guide public opinion. However, due to the rise in paper prices, newspaper groups have taken various measures to reduce costs, using methods such as reduction of edition, color reduction and limitation to increase revenue and reduce expenditure. The proportion of advertisements in individual newspapers is as high as 45%, which will inevitably lead to the loss of some readers, reduce influence and competitiveness in the diversified communication pattern, In the long run, it is not conducive to the development of newspapers and the construction of mainstream public opinion positions

countermeasures and effect analysis of the newspaper industry

major newspaper groups and local newspaper offices have taken measures to deal with the difficulties brought by the rise in paper prices

some newspapers implemented price increases. For example, the retail price of four city newspapers on the Nanjing market was collectively increased by 40% to 0.7 yuan each. The newspapers that raised the price were "Modern Express", "Yangtze Evening News", "Jinling Evening News" and "Nanjing Morning Post". Southern Metropolis Daily raised its retail price in the Shenzhen market from 1 yuan to 2 yuan per copy. After the revision, fortune times increased its retail price from 2 yuan before to 5 yuan now, and the Economic Observer also increased its retail price from 2 yuan last year to 3 yuan. From July 1 this year, the retail price of Chengdu Business Daily and West China Metropolis Daily has been raised from 0.5 yuan to 1 yuan, and that of Chengdu Evening News has been raised from 0.5 yuan to 0.8 yuan. Peninsula Metropolis Daily, affiliated to Dazhong newspaper group, also raised the retail price of the newspaper from 0.5 yuan to 1 yuan on July 1, and the preferential price in Qingdao urban area was 0.8 yuan. On the basis of consultation with Shanghai Wenxin group, Jiefang newspaper group has adjusted the retail price of Jiefang newspaper group's morning post and Shanghai Wenxin group's Xinmin Evening News from the current 0.7 yuan to 1.0 yuan each; It is proposed to adjust the retail price of evening news of Jiefang newspaper group and Oriental Morning Post of Shanghai Wenxin group from the current 0.5 yuan to 1.0 yuan each

as for the price increase of newspapers, many newspapers are actually in a wait-and-see state, because the price of newspapers is relatively low. If the price is increased, even if it is a small base, there will be a large increase. Take a certain as an example. Now the selling price is 1 yuan. If you only increase 50 cents to 1.5 yuan, the growth rate has reached 50%. A substantial rise in the price of newspapers is bound to have a great impact on the distribution, and will also promote the rise of the price index, which will also conflict with the national macro-control spirit. At present, the Internet is becoming more and more popular, the impact of electronic media on newspapers is huge, and the competition in the media market is very fierce. Once the price is raised, it may cause a large loss of readers, which is very detrimental to the long-term development of newspaper business

strictly control the extension of the edition. Many newspapers strictly control the number of pages. For example, some newspaper groups require that newspapers and periodicals should make full use of the existing layout resources. For those without income increment and without approval, the number of issues and layout of newspapers and periodicals should not be increased. For those who really need to increase the number of issues and expand the edition due to publicity and reporting, special instructions should be given in advance and can be implemented after being approved by the leaders of the group

however, there are many emergencies such as snow disaster and earthquake this year. The Olympic Games will be held in August, so the publicity task is very heavy, and it is difficult to control the layout of newspapers. If you blindly control the layout, it will affect the publicity of the principles and policies of the party and the government

improve the reporting rate and reduce the bad reporting rate. Many newspapers now use 45 grams of paper as much as possible. The purchase price of 45 grams of paper per ton is higher than 150 yuan of 48 grams of paper, but the export rate of 45 grams of paper is higher than 7% - 8% of 48 grams of paper, so there is a big gap in the cost of printing completion, which directly reduces the cost expenditure. Secondly, give full play to the effectiveness of computer direct plate making equipment (CTP). The data shows that after using the computer direct plate making equipment, the bad news rate of startup is reduced by more than 30% compared with that of PS version, which can greatly improve the effective use of paper

newspapers are slimming down. The profit model of relying on thick newspapers has undergone some changes with the rise in paper prices, and newspapers have slimmed down. For example, the Southern Newspaper Media Group proposed to change into a narrow newspaper and become the first slimming party newspaper in China on the premise of adhering to the authority and seriousness of the newspaper and making the content more accurate and personalized. Many newspapers have also slimmed down to reduce unnecessary waste of space

however, some newspaper groups report that at present, the means of edition reduction, color reduction, reduction and so on have been used to the extreme. In the long run, it will inevitably lose some readers and eventually affect

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