Newsprint tariffs are threat to industry

Last January, the Commerce Department placed a preliminary duty on producers and exporters of uncoated groundwood paper (newsprint) from Canada that ranges from 4.42 percent to 9.93 percent of wholesale price. That tariff was followed up in March by an anti-dumping duty of 22.16 percent on some Canadian producers and exporters.

The impact of the government’s actions has been a debilitating and in some cases mortal wound to the country’s newspapers – large and small.

In the wake of the tariffs, management at our printing facility in San Antonio, South Texas Press Inc., scrambled to find newsprint to print the dozens of newspapers and periodicals from across the region that depend on the plant for services. A supply was finally obtained but at prices that far outpaced the budgets of most operators.

As it stands now, newspaper customers are paying for what surely was a boneheaded decision to “level the playing field” for U.S. newsprint producers in competition with Canadian manufacturers. The fallacy is that because of the falling demand for newsprint over the last 20 years, there are few U.S. manufacturers left. Many have simply left the business – either closing mills or converting them to produce paper for which there is more demand, such as packaging for e-tailers’ shipments.

The original petition charging unfair trade practices by Canadian paper mills was filed by a single newsprint mill in Longview, Washington, North Pacific Paper Company, which employs about 250 people and is owned by a New York hedge fund. The company, which asked for duties of up to 50 percent, charged that the Canadian government unfairly subsidizes newsprint production by allowing forestry on federal lands and providing financial support in other ways that benefit Canadian production.

Seventy-five percent of the newsprint consumed in the U.S. comes from Canada because that country has continued to produce the product at prices American newspapers can afford despite declining demand. If the DOC is about protecting jobs, it would do well to take stock of the tens of thousands of newspaper jobs that could be lost, as well as those in the supply chain such as ink suppliers, fuel producers and equipment manufacturers.

Recently, a bipartisan group of 10 U.S. senators introduced a bill, the “Protecting Rational Incentives in Newsprint Trade Act of 2018,” or “PRINT Act,” that would suspend new newsprint tariffs until the DOC conducts a study on the economic impact of the taxes on the publishing and printing industries. We encourage Texas senators John Cornyn and Ted Cruz, along with U.S. Rep. Will Hurd, to support the legislation that represents a much-needed lifeline to the printing and publishing industries.

We understand that there are those who occasionally take issue with their local newspaper, which is as it should be. But in the end there are no substitutes for the work of honest journalism to inform the public and serve as a check on the elected officials entrusted with our tax dollars and the creation of sound public policy.

(Graphic is courtesy of the Galveston County Daily News)