NewsAlert: Canada launches global trade complaint vs USA over use of duties

NewsAlert: Canada launches global trade complaint vs USA over use of duties

Andrew Cummings
January 14, 2018

Seth Kursman, a spokesman for Montreal-based Resolute Forest Products Inc., said One Rock Capital is effectively driving the trade agenda in newsprint on behalf of Norpac.

The United States announced tariffs Wednesday on 25 Canadian newsprint producers including Catalyst Paper Corp. of B.C.

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.

It's the third time the USA has slapped duties on Resolute. Those duties could then change in a final ruling, and the company involved would have to prove that it was harmed by the subsidies given to Canadian producers. The countervailing newsprint duty is expected to result in another $45 million a year in deposits.

NewsAlert: Canada launches global trade complaint vs USA over use of duties

Commerce secretary Wilbur Ross said the decision "allows USA producers to receive relief from the market-distorting effects of potential government subsidies while taking into account the need to keep groundwood paper prices affordable for domestic consumers".

Washington-based North Pacific Paper Co. filed a petition a year ago that argued American mills couldn't compete against Ottawa's support for Canadian producers, whose business in the United States was worth $1.3 billion in 2016.

"What the U.S. uncoated groundwood papers industry wants is a level playing field, and this decision is an important step forward for American producers, workers and their families that have been the victims of unfair Canadian trade practices for too long", stated Norpac chief executive Craig Anneberg.

Anneberg said the company estimates the duties would increase the cost to produce the average printed newspaper by less than 5 cents per copy.

In August, Norpac announced plans to idle one of its three paper machines, framing the production cuts as a response to competition from subsidized Canadian manufacturers.

By contrast, Norpac has just one mill and is owned by a NY private equity firm. "This is an effort to perversely manipulate trade laws for short-term gain, putting in jeopardy the communication lifeline of so many small and rural communities in the United States". "This is about lining their own pockets with cash at the expense of hundreds of thousands of American jobs".

"This additional cost resulting from these tariffs will be significant, and yes, they will directly impact us locally here in Jacksonville, Florida, just like any other local newspaper in America", Nusbaum said.

"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 U.S. trade measures and practices".

It has asked the World Trade Organization to examine the use of duties in the United States, alleging that they violate global law for five reasons.

In a letter to Commerce Secretary Wilbur Ross, representatives of more than 1,100 local publications nationwide wrote: "Facing increased costs of newsprint across all suppliers, many small-town papers will be at risk of failing".

"Forest Products Association of Canada [FPAC] strongly believes that these duties are completely unjustified and protectionist in nature", said FPAC CEO Derek Nighbor.

In response to the December 4 letter, Norpac sent another letter to Commerce last month accusing the News Media Alliance of supporting Canadian paper producers at the expense of American jobs and industry.

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