Pulp and paper industry in N.L. braces for Trump administration newsprint duties

The government of Newfoundland and Labrador is bracing for a decision that duties could be applied to newsprint exported into the United States.

Duties would affect half of the newsprint produced in Corner Brook

Kruger, the parent company of Corner Brook Pulp and Paper, is one of three companies targeted in a U.S. investigation of unfair subsidies to Canadian newsprint producers. (CBC)

The government of Newfoundland and Labrador is bracing for a U.S. decision that could apply duties to newsprint exported into the United States.

The department of commerce is expected to make a decision Tuesday afternoon on whether to put duties on all Canadian newsprint exported to the U.S..

An American company, North Pacific Paper Company, has complained of unfair subsidies to Canadian producers, and has asked the U.S. to add duties of 25-50 per cent.

Kruger, the parent company of Corner Brook Pulp and Paper, is one of the three companies targeted by the U.S., but duties would apply to all Canadian producers.

About half of the newsprint produced by the mill in Corner Brook is exported to the U.S., totalling about 120,000 tonnes a year. At going market rates that newsprint is worth about $84 million.

Officials with the Newfoundland and Labrador government say the investigation by the U.S. focused on a $110-million loan the province gave the company in 2014, as well as various tax credits, but then looked at everything the province said or did relating to the mill over the last 13 years.

Part of broader protectionist shift under Trump

Tuesday's ruling is just preliminary, but if applied, will come into effect in five days. Those duties could then change in a final ruling, and the company involved would have to prove that it was harmed by the subsidies given to Canadian producers.

The mill in Corner Brook employs about 500 people directly, and about 2,500 in the broader forestry industry in the province.

Government officials in the province said they feel their case is strong, but the U.S. shift to become more protectionist since the election of Trump means that may not matter.

There have already been rulings by the American commerce department against the aerospace and softwood lumber industries

"We're not dealing with a normal world," an official told reporters during a briefing Tuesday.

About the Author

Peter Cowan

CBC News

Peter Cowan is a St. John's-based reporter with CBC News.

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