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A Troubling Tariff For The News Industry

Published: April 5, 2018

A March 26 newsmediaalliance.org op-ed by that organization’s president and CEO David Chavern hits a home run in describing a situation that threatens the livelihoods of community newspapers in the United States. That is, the dilemma of producing a quality print product while at the mercy of rising costs for newsprint — now further endangered by the actions of a New York equity firm-owned mill in the state of Washington.

In his article, Mr Chavern notes, “The fact that newsprint is being threatened is the work of one newsprint mill in the Pacific Northwest, NORPAC. In August 2017, NORPAC petitioned the United States Department of Commerce (USDOC) to begin applying tariffs to newsprint imported from Canada, claiming the imported paper was harming the US newsprint industry.”

The USDOC initiated an investigation into the complaint, to establish if Canadian government subsidies for uncoated groundwood paper has created an unfair market.

“But NORPAC,” Mr Chavern rightly points out, “is not acting in the best interests of newsprint consumers or the US paper industry at large — they are acting in their own interest and no one else’s.

“The buying and selling of newsprint has always been regional without regard for the border. Consumers of newsprint — from newspaper and book publishers to telephone directory manufacturers — tend to buy newsprint in their region, close to their printing operations. The printers who typically utilize Canadian newsprint are those in the Northeast and Midwest, where there are currently no US mills operating.

“But those regions are not newsprint deserts because of unfair trade by Canadian paper mills,” Mr Chavern writes. “Rather, newsprint mills shut down or converted to producing other, more profitable paper products when the demand for newsprint fell, something that has been happening steadily for decades. Since 2000, the demand for newsprint in North America has dropped by 75 percent…

“With new tariffs, many smaller newspapers will feel their belts tightening. The combination of preliminary countervailing and antidumping duties increases the cost of imported newsprint by as much as 32 percent, and a number of newspapers have already experienced price increases and a disruption in supply… we could see small publishers lose footing, and those tiny local papers are some of the most vital members of our news community…”

The Newtown Bee has already seen an 11 percent increase in the cost of newsprint, and it will likely continue up to 36 percent — that’s a lot of belt tightening and not a lot of wiggle room. Mills keep zero inventory with this fluctuating market, for an additional challenge; this paper is allocated only certain months to buy paper, requiring a keen eye to inventory.

“We may not be able to save the entire industry by keeping tariffs off our paper,” Mr Chavern continues, “but we can keep it thriving while we reposition ourselves for the years to come. Having affordable newsprint will help us do that.”

On March 13, The DOC did instruct US Customs and Border Protection “to require cash deposits” based on preliminary rates of 22.16 percent for many Canadian producers and exporters of uncoated groundwood paper. Those who enjoy the rustle of our broad sheet format as the weekly paper unfolds can help keep community news strong. Let our governor and representatives know that this issue, which seems so far away, is close to home. Tell them to urge the International Trade Commission to reject these tariffs; local papers create jobs and are critical to an educated public — and print remains the mainstay of information for many readers.

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