Preliminary Hearing Held by Trade Commission on Coated Paper Case

October 15, 2009

Big stake for workers as U.S. investigation begins against China, Indonesia

WASHINGTON, Oct. 15 /PRNewswire-USNewswire/ -- The U.S. International Trade Commission (ITC) began their investigation of the trade case filings by the United Steelworkers (USW) and three domestic companies against coated paper imports from China and Indonesia at a preliminary hearing yesterday.

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"We have seen thousands of job losses by multiple plant shutdowns in coated paper manufacturing caused by imports since the period examined in the last petition to enforce fair trade rules against the flood of subsidized imports from Asia," said Leo W. Gerard, USW international president.

"Imports jumped by 40 percent this year, forcing a mill closure in Michigan on top of previous layoffs at idled plants and paper machines in Maine, Wisconsin and other states. Sadly, our case is made stronger by these mounting job cuts. If the rule of law between nations mean something, predatory trade practices that steal jobs must be penalized with the power of government enforcement."

Jon T. Geenen, USW International Vice President, described the wreckage of jobs, families and communities by paper mill shutdowns and idled machines. He testified, "Our plants are not closing because they are run-down or inefficient - they are closing because even the most advanced technology and most productive workers cannot compete against imports sold below the cost of production."

Saying when Wisconsin's NewPage Corp. Kimberly mill shutdown last year with 475 jobs lost, "the damage extends beyond the hundreds of direct jobs that are lost. With few other jobs in the community that can offer comparable wages and benefits, families struggle to make ends meet. Health insurance runs out, and contributions to college savings accounts and retirement funds dry up. Now foreclosure signs are a far too common feature of the landscape."

He declared, "Today our industry stands on the brink."

Reinforcing the paper industry losses from imports, lawyers for the companies and union cited industry data that showed imports from China and Indonesia nearly doubled their share of the U.S. market in the first half of 2009, compared to the same period in 2008. Imports have undersold domestic producers during 2006-09. According to the trade lawyers, this surge in unfair imports also comes at the worst possible time when demand for coated paper has declined substantially.

The companies who filed the petition are: NewPage Corp., Miamisburg, OH; Appleton Coated LLC, Kimberly, WI; and Sappi Fine Paper North America, Boston, MA. The USW represents about 6,000 production workers at paper mills operated by all three companies in seven states, plus non-petitioner companies in two additional states.

According to the trade case filing, thousands of jobs have been cut in the past five years as imports from China and Indonesia flooded into the U.S. market. Imports from the two countries together account for nearly 30 percent of the domestic market. In 2008, coated sheeter mills for NewPage have shutdown in Kimberly; and Chillicothe, OH; and in 2009, a Sappi mill closed in Muskegon, MI.

Members of Congress from paper manufacturing states have been raising their voices in support of the trade case. U.S. Sen. Barbara A. Mikulski (D-MD) wrote to Commerce Secretary Gary Locke and ITC Chairman Shara Aranoff on Oct 13 to advise that the 900-worker NewPage mill in Luke, MD has suffered multiple shutdowns this year from unfair imports. "No one in America should lose a job because other countries aren't playing by the rules."

U.S. Senators Susan M. Collins (R-ME) and Olympia J. Snowe (R-ME) wrote to Locke, saying: "If the allegations made by the petitioners meet the statutory criteria, it is our hope that the (Commerce) Department will take all appropriate action to ensure that American businesses and workers are no longer forced to compete against foreign businesses on an unlevel playing field."

The anti-dumping (AD) and countervailing duty (CVD) petitions were filed at the U.S. Department of Commerce and with the ITC Sept. 23. The paper products covered by the petitions include coated paper used in high-quality printing, and other applications. The cases are expected to take about a year to complete, with an ITC vote of preliminary determination on Nov. 6.

If the ITC determines there is a reasonable indication that imports are materially injuring or threatening material injury to the domestic industry, the investigations will continue. Commerce will be scheduled to make its preliminary CVD determination for an anti-subsidy tariff in December, and its preliminary AD determination in March 2010.

Provisional relief occurs with the Commerce Dept. preliminary determinations that require exporters to post bonds in lieu of tariffs, pending final investigation and orders. The Commerce Dept. announced Oct. 14 its decision to initiate antidumping and countervailing duty investigations on paper imports from China and Indonesia.

About 130,000 workers are represented by the USW in the paper and forestry products industry, a loss of more than 60,000 jobs since 2002.

For more information: www.usw.org/.

Contact: Gary Hubbard, 202-778-4384, 202-256-8125, ghubbard@usw.org

SOURCE United Steelworkers (USW)