Ukraine conflict another nail in print newspapers’ coffin

Mar 16, 2022 at 10:20 am by admin

Wounded by the pandemic and big tech – not to mention floods, bushfires, and the UPM strike – global newspaper publishers are suffering a further assault as a result of Vladimir Putin’s “special operation” in Ukraine.

European print and digital communication federation Intergraf is the latest to warn of increased energy costs, and tightened wood and paper supplies aggravating an already “unprecedented crisis”.

Intergraf says paper prices have risen by 45 per cent – and newsprint by as much as 80 per cent – in the past six months. “These soaring prices, mainly due to increasing energy costs, are now accompanied by a major shortage of paper and board across Europe,” the federation says in a statement.

Apart from newspapers, the shortage of paper and board is expected to have major implications for economies as products such as food and medicines packaging face supply chain disruptions.

The ongoing strike in Nordic paper mills – expected to last to the end of March or into April – is likely to mean printers’ stocks run out before there is a settlement.

Now the war in Ukraine is impacting not only energy prices, but also supplies of wood pulp for European paper makers. “This will further tighten supplies in the middle to long term, which are a major concern for the future of our industry,” says Intergraf.

The problems come on top of a reduction mills’ production capacities – cut in Europe by 25.8 per cent in the last five years – reduced availability of recovered paper, and increased competition for wood fibre from other industries.

Intergraf – which represents 20 national printing federations – has urged stopping exports of pulp and paper to “third countries” to safeguard Europe’s printing and publishing industries, resolution of the strike at Nordic paper mills, and longer-term moves towards autonomy on wood pulp and paper supplies.

In Australia, paper costs have already been impacted by soaring energy and shipping prices, with Norske Skog – which has a historic stranglehold on the market – looking for price increases based on supply shortages for which it is at least partly to blame, following planned closures of NSW and New Zealand mills.

Major publishers in the process of negotiating new contracts have generally been reluctant to talk about the situation,

But Zoe Samios of Nine’s Sydney Morning Herald and The Age, quotes “industry sources” that proposed price increases are between 30 and 40 per cent. And that. ACM managing director Tony Kendall told her, could be fatal for some mastheads and lead to a reduction in pagination ahead of the federal election.

Price hikes scheduled for July, posed “the worst crisis for local publishers since World War II.” Increases would push “some of our publications into negative profitability,” Kendall said, predicting widespread closures.

Star News Group managing director Paul Thomas – who is a director of Queensland’s regional Today Group, which has printing facilities in Rockhampton – told GXpress the unprecedented increase in newsprint prices has the potential to further compound viability issues for publishers.

“The current business uncertainty severely curtails advertising expenditure in media businesses – the lifeblood of newsmedia, and vital to the provision of public interest journalism,” he said.

“Printing businesses have no option than to pass on these increases to their publisher customers, reportedly 30 per cent or more for newsprint, with other printing material inputs also seeing significant increases.”

Country Press Australia president Andrew Manuel said for member publishers, printing price increases reflecting these sort of material price hikes, would immediately impact on the viability of some newspaper mastheads in an already challenging economic environment.
“While these increases are of significant concern, there is no sign that this is the end to the current spate of increases.”

He said CPA members were looking at “various means” to endeavour to reduce the level of the increases with the aim of maintaining viable businesses.

Today’s Rockhampton print centre – anchored by a Manugraph press – was established by then owners APN News & Media, but later acquired and closed by News Corp Australia. Despite the closure of more than 100 of its own print mastheads after the COVID-19 pandemic, and consolidation of plants, News has emerged as the country’s biggest newspaper printer, producing titles under contract for Nine Entertainment, Australian Community Media, and numerous independent publishers.

Pictured: Norske Skog’s Tasman mill in New Zealand closed last June, although a facility there makes heating pellets

Sections: Print business


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