A tariff that sent the costs of newsprint skyrocketing and even led to the closure of some newspapers across the United States was officially ended in late August, but don’t expect to see prices go down anytime soon.
In August the International Trade Commission slapped down a tariff imposed by the Trump administration on Canadian newsprint, saying there was no material harm to U.S. paper mills caused by any breaks Canadian mills receive from their government. One U.S. mill, NORPAC in Washington state, had requested the tariff, which was imposed over the opposition of other U.S. mills, newspaper publishers and printers.
A preliminary tariff of 22 percent was imposed in March, which quickly sent newsprint prices skyrocketing because there wasn’t enough U.S. capacity to handle need. Those increases hit newspapers and printers hard, and those who could passed much of the increase on to clients. This newspaper, for instance, has seen three price increases in the past five months.
A bipartisan effort on Capitol Hill, which included Sen. Doug Jones and Rep. Bradley Byrne, urged the administration not to make the tariff permanent, and in early August the Commerce Department reduced the preliminary tariff to less than 10 percent. The ITC then ended the entire matter later in the month by declaring the tariff useless.
But the damage was done. Through a total absence of actually investigating the newsprint market, the administration artificially raised the prices of newsprint tremendously, not only making the Canadian mills they were supposedly punishing more money, but jacking the U.S.-produced newsprint prices and financially damaging newspapers across the fruited plain.
Now the market will have to slowly bring those prices back down, and they may never be as low as they were. In speaking with a printer two weeks ago, he explained the mills have been making lots of money over the past months and will be loath to reduce prices quickly. On top of that, printers who lost money will likely try to recoup those losses on the backs of their clients before they bring prices back down.
Newspapers are left holding the bag. They can eat the increases or try to pass them along to advertisers and subscribers, neither of which are very appealing fixes at a time when we struggle to keep print advertisers from deserting for the oasis of digital.
The whole saga might serve as a bit of a cautionary tale for those who cheer on knee-jerk tariffs affecting other areas of Alabama’s economy. Soybean farmers have already seen this. Unfortunately for publishers, there’s no multibillion-dollar government subsidy to offset our losses.
Just to give readers an idea of how this matters at the local level, Lagniappe will probably see a more than $30,000 increase in print costs this year alone. And if prices don’t come down next year, that could be much higher. The only options for handling that are reducing the paper size or eating the cost and hoping for more revenue. (It’s probably worth mentioning here once again how spending $1 a week on a subscription can help your hometown maintain a vibrant local newspaper. As does advertising.)
All we can hope now is that newsprint price reductions come sooner rather than later.