The Purchasing Managers' Index (PMI), which is compiled by Markit on behalf of the Chartered Institute of Purchasing and Supply (CIPS), increased in January to 56.7, its highest level since October 1994, and up from 54.6 in December.

The PMI provides an indication of operating conditions in the manufacturing sector and is calculated using data from new orders, production, employment, supplier performance and stocks of purchases.

The increase is a result of new orders, which rose at the fastest pace in six years, as well as companies' efforts to clear outstanding business.

Information derived from the Office of National Statistics (ONS) found that factory gate prices for printed matter increased by 2.3% over the past year, while prices for paper products rose by 1.1%. This compared with raw material increases of 1.2% for print and 0.5% for pulp and paper.

However, in the last quarter of 2009, raw material prices outstripped factory gate inflation, with printed matter rising by just 1.2% and raw material prices increasing by 1.8%. Factory gate prices for pulp and paper products rose in the quarter by 1.4%, but raw material prices went up 3.3%.

BAPC chairman Sidney Bobb said that UK print manufacturing production was "certainly not as good as it was last year".

"While some larger printers in the industry may have experienced a positive upturn, it has not been experienced with smaller companies," he explained. "Research we have undertaken has shown that printers are equally as busy as not busy. However, many said that, if they had more efficient equipment they could do more, but the banking sector isn't helping to enable this."

Rob Dobson, senior economist at Markit Economics, said Markit had asked a stable panel of manufacturers questions about purchasing costs and selling prices, which directly track pipeline inflationary or deflationary pressures.

He said: "The input prices index – which tracks changes in purchase prices but excludes wage and salary costs – pointed to the fastest rate of inflation in costs for 16 months.

"This mainly reflected higher commodity prices and supply-chain factors. On the supply-side, suppliers' stock levels are reported to be low at present, following cut backs during the recession."

The report also found that performance of larger-sized businesses tended to be stronger than at smaller companies. While there was still the mention of ongoing redundancy programmes, some companies reported they have had to raise capacity to satisfy demand.