Economy

US Hits Canadian Groundwood Paper Imports With Tariffs

US Hits Canadian Groundwood Paper Imports With Tariffs

A U.S. Commerce Department decision to impose tariffs on Canadian paper imports is stoking concerns at American newspapers about financial strains facing the news industry.

"What the US 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.

Anneberg told The Daily News that it's too early to say how the duties will affect the company's paper mill in Longview.

Norpac, owned by hedge fund One Rock Capital Partners LLC of NY, said subsidies in Canada include breaks on electricity rates and unfair financial assistance.

Kursman said Norpac was alone in its challenge because production margins are "razor thin".

In a joint statement, Chrystia Freeland, Minister of Foreign Affairs, and Jim Carr, Minister of Natural Resources, said they are "deeply disappointed" with the decision.

Kruger, the parent company of Corner Brook Pulp and Paper, is one of the three companies targeted by the USA, but duties would apply to all Canadian producers. According to the U.S. Department of Commerce, Canada exported more than C$2.4 billion worth of newsprint paper to the United States in 2016.

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Canada has launched a wide-ranging complaint against the United States over its trade practices.

Canada has asked the World Trade Organization to examine the trade practices of the United States.

The Commerce Department's decision follows a petition filed by the North Pacific Paper Company last summer.

The new duties comes as Canada and the USA continue to try to negotiate a trade settlement on softwood to replace the deal which expired in 2015.

"This is not really based on sound objective methods", said Neuheimer.

"Manufacturers are strong proponents of free and fair trade and are concerned that this new tariff barrier will affect Canada's trading relationship with its most important partner, the United States", he said, adding that the duties will also drive up the prices of newsprint up in the USA, hurting American consumers.

"Forestry is as important to the Canadian economy as energy", said Renaud Gagné, Unifor Quebec Director. "Maybe we are going to experience plant shutdowns for a few weeks".