Catalyst Paper hit with American newsprint duties

Catalyst's Powell River mill | Catalyst Paper

The U.S. Department of Commerce is imposing preliminary anti-dumping duties of 22% on Canadian newsprint, but the only company to make the list facing a preliminary duty so far is B.C.-based Catalyst Paper (TSX:CYT).

A final determination won’t be made until August, following an investigation into allegations by Washington state’s North Pacific Paper Co. that Canadian newsprint makers are selling newsprint in the U.S. at “less than fair value.”

Catalyst Paper called the tariff unwarranted and onerous.

 “We are very disappointed with this decision,” said Catalyst president and CEO Ned Dwyer.

“[The duties] pose a threat to our competitiveness and the sustainability of our business and we will continue to vigorously defend ourselves against them.

According to the U.S. Department of Commerce, Canada sold US$1.27 billion worth of newsprint into the U.S. in 2016.

Catalyst owns five paper mills – three in B.C. and two in the U.S.

The new anti-dumping duty in newsprint is the latest in a growing list of protectionist measures being implemented by the U.S.

Canadian softwood lumber companies are already paying softwood lumber duties in the 20% range.

More recently, the U.S. started imposing 25% tariffs on steel imports and 10% tariffs on aluminum. Canada and Mexico have been granted temporary exemptions from the steel and aluminum duties, but a permanent exemption is being tied to North American Free Trade Agreement talks.

The Forest Products Association of Canada has called on the federal government to “aggressively diversify export markets” and implement programs to protect workers who may be affected by a growing list of American tariffs and duties.