The U.S. Department of Commerce has imposed preliminary anti-dumping duties averaging 22.16 per cent against most Canadian newsprint producers that ship into the United States.
The latest tariff is in addition to the average of 6.53 per cent in preliminary countervailing duties levied in January, raising the combined rate to 28.69 per cent against most Canadian producers of uncoated groundwood paper such as newsprint.
In a statement late on Tuesday, the Commerce Department said it “will instruct U.S. Customs and Border Protection to collect cash deposits from importers of uncoated groundwood paper from Canada based on these preliminary rates.”
Canadian firms sent an estimated US$1.27-billion worth of uncoated groundwood paper to the United States in 2016.
Enforcing U.S. trade laws is a major focus of President Donald Trump, U.S. Commerce Secretary Wilbur Ross said in a statement.
“President Trump made it clear from the beginning that we will vigorously administer our trade laws to provide U.S. industry with relief from unfair trade practices,” Mr. Ross said. “Today’s decision follows an open and transparent investigation in accordance with the applicable laws, regulations and administrative practices that ensured a full and fair review of the facts.”
Groundwood from Canada is subsidized and being dumped at less than fair value, according to complaints filed to the Commerce Department in August by U.S. producer North Pacific Paper Co., also known as Norpac. Norpac argues U.S. paper makers are being hurt by Canadian shipments of groundwood.
Montreal-based Resolute Forest Products Inc. and Catalyst Paper Corp. of Richmond, B.C., are the two mandatory respondents in the anti-dumping case. Connecticut-based White Birch Paper Co., which has three Quebec paper mills through its Canadian unit, is the voluntary respondent in both the countervailing and anti-dumping cases.
The Commerce Department already slapped a duty rate of 6.09 per cent against Catalyst in January. With the addition of 22.16 per cent in countervailing duties, that raises the B.C.-based firm’s combined tariff to 28.25 per cent.
Resolute, Catalyst and Montreal-based Kruger Inc. are the three mandatory respondents in the countervailing investigation.
The Commerce Department hit Resolute with countervailing rate of 4.42 per cent in January but did not impose an anti-dumping tariff.
Kruger, however, must now pay 32.09 per cent in total tariffs – 9.93 per cent for the countervailing rate and 22.16 per cent for the anti-dumping portion.
White Birch escaped being hit with any anti-dumping penalties, and since its countervailing duty is only 0.65 per cent, the company isn’t on the hook for cash deposits because the January tariff is under the threshold required for the United States to collect duties.