Badal Sanyal

Kolkata, Jan 9

THE domestic newsprint market is likely to stay bullish throughout 2006 in anticipation of strong buying support from the newsprint consuming sectors.

Considering that there will be a 10 per cent growth in demand, the country may face a further demand-supply gap of about 1.5 lakh tonnes during the year.

It is anticipated that the demand will touch the level of about 16.5 lakh tonnes against last year's consumption of about 15 lakh tonnes.

Encouraged by the buoyant market situation, a section of domestic manufacturers producing quality newsprint has revised prices on an average by Rs 1,500 a tonne of standard newsprint with effect from January 1, 2006.

Small and medium mills with limited production capacity of quality products may also get an opportunity to enhance their sales realisation.

They may revise prices moderately in sympathy with the revision by quality newsprint producers.

An executive committee member the Indian Newsprint Manufacturers Association (INMA) said that the domestic production may not go beyond seven lakh tonnes in 2006 since no major fresh investments are being made in the country to expand capacities.

Of the total projected capacity, the production of quality newsprint might be about 4.5 lakh tonnes, largely from the State-owned Hindustan Newsprint Ltd, and Rama Newsprint & Paper Ltd, Mysore Paper Mills Ltd, and Emami Paper Mills Ltd.

The INMA source said that the average ex-mill price of standard quality newsprint would now be about Rs 27,500 a tonne compared to the landed cost of the same variety of imported newsprint of about Rs 32,000.

He also indicated that newsprint prices in the international market might surge further following higher offtake by the print media in China and other Asian countries whose economies appear buoyant.

(This article was published in the Business Line print edition dated January 10, 2006)
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