Unbearable price rises: Hungarian publishers at risk

In addition to the worsening economic crisis, the world has been also struggling with a paper shortage. Approximately a year ago, the price of cellulose started rising, which started with the Covid pandemic. When everybody was stuck at home, the volume of online orders increased drastically. All the packages needed wrapping materials, which in turn generated a shortage of paper. However, this poses a threat to Hungarian publishers now.

During the Covid pandemic, there was no other choice but to order online. The immense number of packages required a lot of packaging materials which withdrew the cellulose from graphic paper. This is the type used for book printing, newspapers and basically everything that we use to read. This shortage pushed the prices into the sky and in some cases, the price hike is about fifty percent. There is a shortage of paper, despite the fact that printing becomes less profitable every year, which caused the closure of many paper factories.

Publishers at risk

Although the cost of paper is at its highest as it has to be imported, the price increase has not stopped yet. Hungary’s paper production is very low, so most of the paper comes from Western and Northern Europe. Publishers have to pay in euros for the imported product, which is a huge burden with the current exchange rate. Paper production is also affected by rising energy costs as these factories require a lot of energy during the production process.

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Hungarian publishers and printing houses are in a difficult situation — reports VG.hu. The utility cost increases also take a toll on them, not just on the factories. Compared to 2021, the price of a single publication can cost 40 percent more this year. The publishers have two choices: they either lower their stocks of publications or they go into debt to keep their current numbers.

The current economic crisis also poses liquidity issues. Due to the rapidly fluctuating situation, the number of unpaid debts has also increased. Publishers have to be wary when it comes to payments. Until now, delayed payments were not a problem. However, today it is a very likely possibility that some customers might not be able to pay.

Every industry related to paper is currently.in danger. This year’s school start was much more modest compared to previous years, so there is an observable decrease in demand. More customers look for cheaper alternatives as the price of goods increases. Fortunately, there is still a market and, therefore a demand for high-quality items.

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Source: vg.hu