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Q&A: Effects of newsprint costs on The Interior Journal

STAFF REPORT

The Interior Journal

Why is the newsprint The Interior Journal is printed on in short supply?

More than a dozen mills in the United States have stopped making newsprint in the last decade because demand for paper has declined 75 percent as large newspapers have lost readership.

If newsprint production capacity has declined over the course of 10 years, why are newsprint prices just now increasing?

Newsprint is a commodity, and its pricing has fluctuated regularly in past years.  Recently, one small paper mill in Washington State has tried to use federal trade and tariff laws to improve its profits.

North Pacific Paper Co., or NORPAC, complained to the U.S. Department of Commerce and International Trade Commission that Canadian newsprint mills, which produce much of the newsprint consumed in America, are engaging in unfair trade practices, including government loan subsidies and harvesting of trees on government land.

Temporary tariffs of more than 20 percent have been applied while authorities investigate. If the tariffs are made permanent, the price of newspaper printing will skyrocket.

Shouldn’t the tariffs on Canadian imports boost domestic production of newsprint?

Even if Canadian paper disappeared because of high tariffs, U.S. paper mills, which industry observers estimate are running at 97 percent capacity, could not supply newspapers with the paper they need. Mills cost hundreds of millions of dollars to build or reopen and can take many years to comply with environmental rules. With demand falling, it is unlikely paper manufacturers will invest in a massive expansion of U.S. newsprint production. The industry organization for U.S. paper producers, the American Forest and Paper Association, does not support NORPAC’s case.

What has been the impact on newspapers to date?

Preliminary duties against Canadian producers began in January in the range of 6.5 percent to nearly 10 percent for the alleged trade violations. Another set of duties began this month with an assessment of 22 percent for alleged underpricing or “dumping.”

The preliminary findings are not unusual and do not mean that the final determinations will end with such major assessments. U.S. trade laws are engineered to give the benefit of the doubt to domestic producers, even at the cost of higher prices to consumers.

Preliminary findings can be intended to provide some interim relief even before final facts are in. These tariffs are being collected now at the U.S.-Canadian border, however, and are in escrow until final findings are complete. Newsprint producers are already escalating their prices to U.S. newspapers. The harm to newspapers has already begun.

What do the Canadian producers say about the allegations?

Canadian companies say that U.S. publishers’ demands have fallen as large daily newspapers have cut back, merged, closed or dropped publication days as digital commerce and competition have driven reductions in advertising and print readership. Market forces, not trade practice, are responsible for the harm to U.S. paper producers, they say.

Why do you still publish a printed newspaper instead of going all digital?

Digital publication has become common for most newspapers, including this one. However, there continues to be strong demand for and use of the printed newspaper.

Further, community newspaper publishers cannot support online versions of their newspapers without a printed newspaper. Hard-copy advertising and readership provides 90 percent or more of a community media company’s revenue and enables the digital newspaper to exist.

In other words, without print, there would be no online news from your local newspaper. These revenue streams support The Interior Journal’s mission of providing Lincoln County with journalism and marketing professionals who work every day on behalf of readers and advertisers.

We also understand how useful the print version of The Interior Journal is to many in Lincoln County, especially in areas where internet service is not as easily accessible.

What will happen if the tariffs are made permanent?

Publishers will not be able to absorb the significantly higher cost of newsprint, which is a newspaper’s second-largest expense behind payroll. Newspapers will likely have to raise prices for readers and advertisers, reduce distribution by eliminating publication days, and reduce our workforce. Not only will newspapers suffer, but so will our workers, readers and advertisers.

Can newspaper readers do anything to stop the tariffs?

Yes, you can contact your U.S. senators and representative and ask them to submit written comments to the International Trade Commission. Visit www.stopnewsprinttariffs.org/contact-congress/ for sample language and contact information. If you prefer to send a letter by mail or contact by phone, information is provided below. Consider the following language when contacting lawmakers:

I urge you to get involved with an important issue that has dramatically impacted not only our community, but our nation’s entire economy. The Department of Commerce recently announced countervailing and anti-dumping duties on Canadian imports of newsprint that range as high 32 percent. These duties cannot be absorbed by newspapers and printers and most likely will lead to higher prices for readers and businesses, causing a loss of jobs in printing and publishing at the local level.

This issue started when one newsprint mill in the state of Washington, which is owned by a New York hedge fund, filed petitions for tariffs. The rest of the paper industry opposes the petitions because they know that these tariffs will cause damage to newspapers and printers and will ultimately reduce the demand for newsprint.

I understand that the trade case is at a critical phase at the International Trade Commission, and members of Congress can express submit comments to the ITC on the impact of these tariffs on constituents. I respectfully request that you let the ITC know that this newsprint trade case will cause unintended consequences to our economy and local community, and should be rejected.

Thank you for your consideration of my views.

Mitch McConnell (R-KY)

317 Russell Senate Office Building, Washington, D.C. 20510

(202) 224-2541

mcconnell.senate.gov/public/index.cfm?p=contact

Rand Paul (R-KY)

167 Russell Senate Office Building, Washington, D.C. 20510

(202) 224-4343

paul.senate.gov/connect/email-rand

Hal Rogers (R)

2406 Rayburn House Office Building, Washington, D.C. 20510

(202) 225-4601

halrogers.house.gov

If tight newsprint supplies caused an interruption in print publication, what would The Interior Journal do?

We would continue to produce a weekly newspaper and distribute it as an electronic edition, also called an e-edition, which is a digital replica of the printed newspaper that can be viewed on any desktop computer, laptop, tablet or smartphone. A 4G cellular connection is strong enough to allow for easy viewing of an e-edition on any cell phone or tablet computer. The e-edition is free for all print subscribers.

How do I access the e-edition?

Visit www.theinteriorjournal.com and click on “E-EDITION” at the top right of the home page. If you are already registered as a subscriber in our system, you will be prompted to enter your username and password. If you are not registered, you will be guided to create an account. If you are not currently a subscriber, the same link will guide you through subscribing. If you have any problems, call us at (859) 236-2551 or email subscriptions@interiorjournal.com.

What if I like the e-edition and no longer want to receive the printed newspaper?

There are many advantages. You’ll save money and receive the newspaper in your email by 7 a.m. every Thursday. And you’ll do your small part in addressing the newsprint shortage.