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Paper industry faces forex woes
Paper prices went up in the first quarter of this year due to the depreciation of the dong against the dollar, industry insiders said.
Paper now costs VND23.1 million (US$1,100) per tonne, a rise of VND2.2 million ($104.76) compared to the end of last year, as opposed to newsprint which costs VND14.5 million ($690.48) per tonne, compared to $38.1 at the end of last year.
Meanwhile, the cost of printing and writing paper imported from Indonesia and Malaysia remains at about $1,024-1,047.6 per tonne.
"Firms have raised prices by 5-7 per cent," said Vu Ngoc Bao, General Secretary of Viet Nam Pulp and Paper Association.
He blamed higher costs and the depreciation of the dong to the dollar for the rises.
"Recently, coal and petroleum prices have sharply increased, impeding the production and consumption of paper in the market," Bao said.
Adding to firms' woes, the cost of borrowing had also gone up.
Meanwhile, they were still having to import up to 45 per cent of their materials, Bao said.
The Viet Nam Paper Corporation said consumption in the US, Europe and Japanese had declined.
"Although Vietnamese producers have made great efforts to reduce production costs, the slow application of new technology and modern equipment has weakened their competitiveness," Bao said.
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