WASHINGTON – The U.S. Commerce Department has imposed a 22.16 percent import tariff on Canadian newsprint companies it says are unfairly pricing their paper against U.S. mills.

The Wednesday announcement said the tariff results from a preliminary investigation that determined some companies are underpricing and dumping uncoated groundwood paper used in newsprint as a result of Canadian government subsidies.

A final decision in the investigation is expected about Aug. 2, the Commerce Department said. But U.S. Custom authorities will begin collecting cash deposits immediately from Canadian importers based on the preliminary duty rate.

Newsprint accounts for about 20 percent of newspaper expenses. Canada is the largest exporter of newsprint in the world and the principal supplier for U.S. newspapers. The current price for newsprint is around $570 per metric ton.

The Canadian companies are expected to pass at least some of the tariff on to U.S. newspapers, causing an major cost problem for an industry already facing tough economic challenges from declining advertising and subscription revenues.

U.S. publishers and commercial printers have strongly objected to tariffs on uncoated groundwood paper, which is also widely used in book publishing.

News Media Alliance, the organization that represents most American newspapers, has said tariffs will lead to job losses and likely cause some smaller newspapers and printers to close. Several members of Congress have also voiced opposition to tariffs on imported Canadian paper.

The U.S. newspaper publishing and commercial printing business employs about 600,000 people in cities and towns across America.

The Commerce Department investigation of Canada’s newsprint industry stems from an unfair trade complaint filed last year by the Longview, Washington-based North Pacific Paper Company. It claimed Canada was dumping newsprint into the U.S. market and unfairly subsidizing its industry at home.

The problem, publishers point out, is the insufficient capacity of the few mills in the U.S. to meet newspaper needs. Mills have been closing in both the U.S. and Canada because papers are using less newsprint to counter falling revenue. They are also moving strategically into digital news delivery.

The largest Canadian suppliers targeted by the U.S. newsprint tariff are Kruger and Catalyst Paper Corp. but there are also several smaller mills affected.

Resolute Forest Products, Canada’s largest newsprint manufacturer, and White Birch company are not covered by the tariff because the Commerce Department investigation determined they were not dumping newsprint into U.S. markets.