Catalyst Paper, which owns the pulp and paper mill in Crofton, is disappointed with a recent decision by the U.S. Department of Commerce that will impose a large anti-dumping duty on the forest company.
The 22.16 per cent anti-dumping duty deposit is on the company’s exports of uncoated groundwood paper products, which is used to print newspapers, directories and catalogues, to American markets.
Uncoated groundwood directory paper was excluded from the duty.
The decision comes on the heels of the preliminary decision of the DOC on Jan. 9 that Canadian producers of uncoated paper are unfairly subsidized.
That means Catalyst, which exports a significant portion of its Canadian production to the U.S., faces countervailing duties of 6.1 per cent on its shipments to the U.S from that decision as well.
The DOC’s final determination of both the countervailing duty and anti-dumping duty is expected in August.
“We are very disappointed with this decision,” says Ned Dwyer, Catalysts’s president and CEO.
“This U.S. trade action is unwarranted and without merit. Even with the exemption of directory paper, the remaining anti-dumping and countervailing duties are onerous and a critical cost challenge for Catalyst. They pose a threat to our competitiveness and the sustainability of our business and we will continue to vigorously defend ourselves against them.”
The Crofton mill employs more than 570 people, while Catalyst’s Powell River mill has almost 450 workers.
In November, 2016, the DOC decided after a review that Catalyst’s exports of supercalendered paper into the U.S. market would not be subject to countervailing duties because the company received a negligible amount of subsidies during the applicable period of review.
Catalyst requested the review, which looked specifically at its production during 2014, after the DOC imposed countervailing duties on imports of supercalendered paper from Canada in December, 2015.
Catalyst was saddled with a countervailing duties rate of 18.85 per cent, and paid more than $18 million in duties and legal costs before the countervailing duties on the company were suspended.