Newsprint tariffs hit U.S. media hard

August 10, 2018

The Trump administration is hitting the nation’s “fake news” publishers where it hurts, even as it continues a simmering trade war with its closest ally, Canada.

On August 2, the Department of Commerce announced that it would proceed with somewhat lower tariffs on Canadian newsprint, a blow to an already-flailing (and failing) U.S. newspaper industry. Indeed, the administration’s decision to impose these tariffs is leading to the demise of local newspapers—forcing already-struggling publications to cut staff, reduce the number of days they print; and, in at least one case, close their doors entirely, according to an August 8 report by The New York Times.

Papers throughout the country already are feeling the effects of the tariffs, the Times said. At least a dozen newspapers across the country have cut publication days, and one newspaper, The Jackson County Times-Journal in Ohio, shut down, citing declining print readership and the tariffs.

An August 3 story by The New York Post, revealed that the tariffs originally imposed by America in May had added up to 30% to the price of newsprint imported from Canada. The latest tariffs range from 8% to 20%.

In reaction to the revision, the trade group News Media Alliance stated that it “doesn’t solve [the] underlying problem.”

Specifically, President and CEO of the alliance David Chavern released comments noting, “While we appreciate the hard work the Commerce Department has put into this investigation and that the margins have been reduced, we believe the final determination does not solve the underlying problem. These taxes on Canadian imports for newsprint, which have been collected during in the preliminary phase, have already caused job losses at newspapers across the country and resulted in less quality news and information being distributed in local communities.’

Others in the industry agreed. “We appreciate Commerce’s slight reduction in tariffs; however, commercial printing companies, book printers, suppliers, and consumers will still pay a price with increased costs and less business, which will hurt our member companies, their employees, and ultimately U.S. newsprint manufacturers. We hope the International Trade Commission will reverse this tax on paper,” said Michael Makin, president and CEO, Printing Industries of America.

“It’s a step in the right direction, but these tariffs are still causing damage and need to be repealed to protect newspapers,” said Paul Boyle, head of Stop Tariffs on Printers & Publishers (STOPP). Newsprint, the second biggest cost to publishers after workers, is now close to $800 a metric ton, said Boyle.

According to the Times report, surging newsprint costs are beginning to hurt publications like The Gazette in Janesville, Wisconsin, the hometown paper of the Speaker of the House Paul D. Ryan (R-Wisconsin). The paper, with a newsroom staff of 22, was the first to publish the news in 2016 that Mr. Ryan would support the presidential candidacy of Donald J. Trump. And while its editorial board has endorsed Mr. Ryan countless times, the paper made national news when it chided him for refusing to hold town halls with his constituents. Now, with newsprint tariffs increasing annual printing costs by $740,000, the Gazette has made several cuts to its staff and is using narrower paper—thereby, reducing the number of stories published every day.

We’re all paying a huge price,” Skip Bliss, the publisher of the Gazette, said of the tariffs’ effect on the industry. “I fear it’s going to be a very difficult time. I

As with Mr. Trump’s other tariffs on steel, aluminum, solar panels and washing machines, the newsprint duties will help some American manufacturers but hurt many other domestic  companies, the Times reported.

A study conducted by Charles River Associates on behalf of a coalition of printers, publishers and paper suppliers projects that American newsprint prices will increase more than 30% within the next one to two years, and that newspapers and printers will face an increased cost of roughly half a billion dollars from the remaining five American mills producing newsprint.

Research contact: sgarnett@crai.com

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