The U.S. Department of Commerce on Tuesday handed down preliminary tariffs on uncoated groundwood paper exported from Canada after concluding that producers in the neighboring country had received government subsidies ranging from 4 to almost 10 percent.
Catalyst does have other export options to mitigate the impact, said industry analyst Kevin Mason with the firm ERA Forest Products Research, but argued the trade action is a self-serving move that will only hurt USA newsprint consumers in the long run. It has essentially claimed that Canadian government subsidies are giving Canadian newsprint producers an unfair advantage over US paper producers, and that the Canadians are dumping paper on the USA market at prices below the cost of production.
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Kruger faces a preliminary duty of 9.93 per cent, while the duty against Catalyst Paper is 6.09 per cent, 4.42 per cent for Resolute, and 0.65 per cent for White Birch.
The U.S. Department of Commerce has made a decision to impose initial duties of up to 9.93 per cent against Canadian newsprint sold south of the border. If both it and the US International Trade Commission make affirmative final injury determinations, Commerce will issue a countervailing duty order.
Ross and his department should listen to the overtures of The News Media Alliance, National Newspaper Association and a bipartisan coalition of congressional members who oppose the duties on Canadian paper used to publish American newspapers.
Canada is the largest exporter of newsprint in the world, dominated by Resolute Forest Products, Kruger and Catalyst Paper Corp. The tariffs are expected to take effect within one week. At going market rates that newsprint is worth about $84 million.
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Any duties will have a direct and negative impact on U.S. newspapers, especially those in small cities and towns, and result in job losses in the American printing sector".
Resolute and Catalyst are the two mandatory respondents in the anti-dumping probe.
Anneberg told The Daily News that it's too early to say how the duties will affect the company's paper mill in Longview. "An escalation in paper prices would push some over the edge, and cost their communities not only the newspaper jobs but the news and advertising support that drives other local jobs".
The company estimates the ruling will raise production costs by less than five cents per newspaper.
"While we understand the concerns recently surfaced by some newspaper publishers, we strongly disagree with the notion that their industry requires low-cost, government-subsidized, imported newsprint from Canada to sustain its business model", he said.
It had asked the World Trade Organization to examine the American use of punitive duties, alleging that they violate global law for five reasons.
The News Media Alliance, which represents more than 1,100 newspapers nationwide, sent a December 4 letter addressed to Commerce Secretary Wilbur Ross urging the agency to closely scrutinize Norpac's requests.
The Commerce Department slapped final softwood duties on West Fraser that totalled 23.56 per cent; Tolko 22.07 per cent; Canfor 20.52 per cent; Resolute 17.90 per cent; and voluntary respondent J.D. Irving Ltd. of New Brunswick 9.38 per cent. The revised softwood duties took effect on January 3, 2018, after preliminary tariffs that were set as high as 30.88 per cent. "We will continue to work with our forest industry, provinces and territories, and communities across Canada to defend this vital sector against unfair and unwarranted USA trade measures and practices".