One company’s attempts to further its interests by filing a complaint against what it calls unfair business practices could have far-reaching publishing industry effects. Here’s what you need to know about the tariffs the U.S. is imposing on certain Canadian paper products, how the decision could affect your book publishing operations, and what those in affected industries are doing to “STOPP” the import taxes.
One company’s beef
In 2017, Washington-based North Pacific Paper Company (NORPAC) filed a complaint with the U.S. Department of Commerce (DOC). The paper company, owned by hedge fund One Rock Capital Partners, claims its business has been hurt because government-subsidized Canadian paper mills are dumping uncoated groundwood papers into the U.S. market at less than fair value.
In January 2018, the DOC ruled in NORPAC’s favor and agreed to impose tariffs on Canadian imports of uncoated groundwood paper to counter the effects of the government export subsidies. In March, the DOC began imposing the 22.16% tariffs. A public hearing and final decision on the tariffs should occur in August 2018 but, in the meantime, those in U.S. industries, including book publishers, are already feeling the effects.
Publisher impact
Tariffs on these uncoated groundwood papers publishers use in newsprint and book publishing are driving up printing costs. This is important because U.S. imports of the paper totaled $1.27 billion in 2016, and Canadian companies sell approximately two-thirds of the newsprint paper those in the U.S. use today.
This comes at a time when paper mills in the U.S. have been closing due to decreasing newsprint demands. As a result, the few mills still around can’t keep up with demand, considering the taxed imports. If the tariffs remain in place, these increasing newsprint costs will likely negatively impact the U.S. papermaking industry further due to drops in demand. In all, the DOC’s decision has the potential to threaten more than 600,000 U.S. jobs across the printing and publishing industry, according to The Columbian article.
Jim Fetherston, publishing company president and CEO as well as president of the Book Manufacturers’ Institute told the Bluefield Daily Telegraph that the “tariffs will have a devastating economic impact especially on the domestic printing industry and the tens of thousands of Americans employed in the process of making books.”
STOPP the tariffs
To fight the tariffs, a number of companies, organizations, and associations have created a coalition called Stop Tariffs on Printers & Publishers (STOPP). According to the Livingston County News article, the coalition argues that the shift to digital caused financial harm to U.S. paper producers, rather than unfair Canadian pricing practices. It says imposing the tariffs will add further harm, causing more publisher closures and job losses. STOPP, which has support from the Association of American Publishers, Book Manufacturer’s Institute, Association for Print Technologies, Catalyst Paper, Trusted Media Brands, and various forestry organizations, among others, plans to continue pressuring the International Trade Commission (ITC) as it continues to investigate the NORPAC petition. STOPP hopes to convince the ITC that the tariffs serve only one company and will harm, not help, the paper, publishing, and printing industries.
In fact, STOPP members are now working with U.S. Senators from Maine, Angus King and Susan Collins, who introduced a bipartisan bill to stop the tariffs. Called the Protecting Rational Incentives in Newsprint Trade (PRINT) Act, the bill would pause import taxes and “require the U.S. Department of Commerce to complete a study within 90 days on the economic health of the newsprint and U.S. newspaper industry in general,” according to the Printing Impressions article. That study would then go on to the president who would have to ensure any tariffs would be in the U.S.’s best interests.
Interested in joining the fight? You can add your voice to the cause by contacting your state representatives or joining the STOPP coalition.
From print to eBooks and eCommerce, Sheridan has your book publishing needs covered. Contact your Sheridan representative for a consultation.
