Xinhua reported on 3 April 2008, that driven by rising global paper pulp prices, Chinese newsprint has hit nearly 5,500 yuan (US$ 783.5 and Rs. 31,371) a ton, up 20 per cent from a year earlier, the biggest increase in the past five years.

The sharp rise has eroded the profit margins of publishers and paper media alike. Since last year, the combination of a voracious demand for books and a crackdown on small, polluting paper mills has caused a paper crunch in China. This has pushed up paper prices, forced printers to delay books and publishers to raise prices. Sources with Beijing-based publishers said they had revised their plans to publish four to five books monthly as projected earlier, to one or two titles now. For publishing the Chinese paperback translation of “Harry Potter and the Deathly Hallows”, the seventh in the boy-wizard series, the People’s Literature Publishing House president went to paper mills in person to order paper.

The rise has hardly benefited paper producers. The price of paper pulp has risen to 5,800 yuan per ton from 4,000 yuan in January, while finished paper prices rose by 700 to 800 yuan. Paper media, especially newspapers, were facing an even worse situation than publishers because their production cycle was significantly shorter. According to the China Newspaper Association, newsprint paper accounts for 60 to 70 percent of the newspaper production cost.

Due to global price rises, China bought 8.47 million tons of paper pulp abroad last year, representing a year-on-year increase of 6.5 percent, according to a General Administration of Customs source. The arrivals were valued at 5.55 billion U.S. dollars, up 26.3 percent. The customs source said reducing production and increasing demand at home accounted for the imports growth. s part of energy conservation and emission reduction efforts, China shut down 1,562 small pulp workshops in the first three quarters of 2007, leading to a decrease of 15 per cent in paper pulp production nationwide. The country is now the world’s second largest paper consumer, behind only the United States.