The U.S. Department of Commerce has slapped a 9.93 per cent duty onto newsprint from Corner Brook headed into the United States.
Late Tuesday night, an interim decision came from an investigation into whether or not the newsprint shipped from Kruger Inc. and other Canadian producers into the U.S. has been unfairly subsidized by government. The new charge on newsprint coming into the U.S. is a counterveiling duty, designed to level the playing field for American producers.
Kruger’s exports, including product from the mill in Newfoundland and Labrador and mills in Quebec, will see the highest charge being applied to Canadian product, with the weighted average at 6.53 per cent.
“The United States is Newfoundland and Labrador’s largest trading partner representing close to 60 per cent of all goods exported from the province. As a government, we have worked vigorously to advocate for local businesses and workers, including Corner Brook Pulp and Paper, against the increased protectionist environment that exists in the United States,” Premier Dwight Ball said, in a statement issued shortly following the decision.
It noted the province has had trade lawyers in the U.S. and Canada, and a designated internal working group, on the response to the investigation relating to unfair subsidization. Iy says the province will explore every opportunity to advocate on behalf of the company and local forestry industry.
Newfoundland and Labrador Fisheries and Land Resources Minister Gerry Byrne said in the statement the Liberal government has been working to diversify the province’s forestry industry. He said government will continue to advocate against the new tariff facing Corner Brook Pulp and Paper.
“A decision to place a countervailing duty on Kruger could have the potential to significantly affect industry, communities and residents in the western region as well as the province as a whole,” said MHA for Humber-Bay of Islands Eddie Joyce. “Our government will continue to work hard on behalf of the company and the forestry industry. We are engaging the federal government as we work to address this issue together.”
Earlier on Tuesday, the provincial Progressive Conservatives issued a statement ahead of the decision out of the U.S. questioning the ability for the provincial Liberal government to make the threat posed by a tariff, applying to half of the product from the Corner Brook mill, a national priority.
The U.S. investigation was two-pronged, with the second piece being about anti-dumping and determining if Canadian newsprint was being sold into American markets below domestic rates. Kruger was not a designated respondent in that portion of the investigation (on countervailing, it was, along with Resolute Forest Products and Catalyst).
A decision on anti-dumping is expected in March. And a final decision on both countervailing and anti-dumping tariffs will come later in the year.