Tariffs on Canadian paper squeezing news industry
It is not your imagination: your newspaper may well be smaller these days.
Publishers at newspapers nationwide, already buffeted by the transition to digital media, say reducing page counts is one adjustment they have made since tariffs on Canadian newsprint — the paper newspapers are printed on — increased cost by 32 percent this year.
In an industry where newsprint is typically the second-highest cost after payroll, publishers are scrambling to balance their books and meet their watchdog mission that many see as the cornerstone of democracy.
A recent survey by the Pennsylvania News Media Association, which represents 76 daily newspapers and 140 weeklies and non-dailies across the state, found 84 percent have cut pages, 44 percent have not filled open positions and 22 percent have reduced staff.
Pennsylvania newspaper publishers, from the smallest weeklies to large dailies, estimated the tariffs could add anywhere from $5,000 to more than $2 million to their costs this year.
The U.S. Commerce Department imposed the tariffs — taxes on imported goods — in January and increased them in March in response to a complaint from NORPAC, a hedge fund-owned paper mill in Longview, Wash., that employs about 300 people. The mill, owned by New York-based One Rock Capital Partners, claimed it was being harmed by subsidized newsprint from Canada.
Anywhere from 60 percent to 75 percent of U.S. newsprint comes from Canada, which claimed an ever-larger portion of the U.S. market over the last two decades as U.S. plants closed when newsprint demand declined by 75 percent.
Five paper mills now operate in the United States.
David Chavern, president and CEO of the News Media Alliance, a national trade group in suburban Washington, D.C., has spoken out repeatedly against the tariffs and the damage they are doing to newspapers.
In March, he blasted the tariffs as “political arbitrage” that tapped the U.S. government to tax local and community newspapers to the benefit of one private investment group.
Trib Total Media also has been forced to make significant adjustments to its publications, said Jenn Bertetto, president and CEO.
“We have reduced page counts in our free weekly publications whenever possible and eliminated some pages from our Sunday edition by tightening up the sections. We also implemented a 25-cent increase to our daily single-copy price and 50 cents to our Sunday edition. Just last week, we received a notice of another $22.50 per metric ton increase coming in July. The increases just keep coming, and if they don't stop soon, we will need to choose between passing more of the increases on to our customers or reducing the amount of news we cover in our print edition, and I personally don't like either option,” she said.
It takes about 5 metric tons to produce a daily edition of the Tribune-Review and three times that amount to produce Sunday editions.
Bertetto is concerned with the financial hardship on the company's commercial clients, who are receiving a rate increase every month because of the impact of the tariffs.
And the pain of the tariffs is also felt on the region's nonprofit organizations.
“We have traditionally donated a lot of advertising space to nonprofits in our region, but because of the increased prices, we have tried to eliminate as much unpaid advertising space as possible,” Bertetto said. “That hurts the ability of local nonprofits to advance their mission through newspaper.”
Ralph J. Martin is executive vice president of Steinman Communications, the family-owned parent company of LNP News in Lancaster. He said Steinman has been reluctant to reduce pages in Lancaster, where the company publishes one of the nation's oldest daily newspapers.
“They don't want to mess with the news, but those days are ahead of us if Congress doesn't act to eliminate the tariffs,” said Martin, former CEO of Tribune-Review parent company Trib Total Media.
Contraction of the U.S. newsprint industry left publishers dependent upon Canadian imports, he said.
“There are no alternatives. There is not even enough newsprint in the U.S. It's very scary times,” Martin said.
Mike Donnelly, the third-generation publisher of the family-owned Indiana Gazette, said a 30 percent increase in newsprint costs is hitting his newspaper and its commercial printing business.
“It is difficult to recoup any of that with readers and advertisers in our market. So, we've had to cut page counts,” he said. “We hope it doesn't come to a loss of jobs. But it is going to be difficult if you don't address that issue at some point in time.”
Frank Leto, publisher of the Daily Item in Sunbury, Northumberland County, said the paper is carefully managing its newsprint supply.
“This is affecting everyone to different degrees,” Leto said. “We're looking at ways to do fewer sections and pages and tighten our ad-to-news ratio.”
Elsewhere, some are attributing job losses to the tariffs.
In April, the Tampa Bay Times announced 50 jobs would be eliminated at the newspaper on Florida's Gulf Coast. The newspaper said it was because the tariffs were adding $3.4 million to the cost of publication.
Mark Cohen, president of the Pennsylvania News Media Association, said he plans to join industry executives to lobby Congress on Wednesday and Thursday.
Cohen said he knows of no papers that have ceased publication or missed a press run.
“But all options are on the table when you have to get to your financial commitment. For many of our members, this is just now hitting home. We're going to see more action in the next 30- to 60-day window,” he said.
U.S. Sen. Pat Toomey, R-Allentown, is among 17 senators sponsoring the PRINT Act. The bill seeks to suspend the tariffs pending a study of the health of the newspaper industry. A companion bill was introduced in the U.S. House this week.
The tariffs could spell the death knell of publications already facing “unprecedented challenges,” Toomey said.
“American companies must be allowed to adequately and fairly source materials, especially when those items are not produced domestically,” Toomey said.
U.S. Sen. Bob Casey, D-Scranton, said the PRINT Act could set a dangerous precedent and establish a new “national interest” standard in trade law. But last week, he wrote Commerce Secretary Wilbur Ross, urging him to suspend the tariffs immediately.
“Local newspapers and a free press are a bedrock of our democracy, and they must have the resources available to faithfully report and transmit the news,” Casey said.