Paper Battle to Be Decided in October

WASHINGTON, DC—The Commerce Department (DOC) has issued final anti-dumping and countervailing duty margins on coated paper imports from China and Indonesia, providing a victory for domestic paper producers that may be short lived. The U.S. International Trade Commission (ITC) will hold a final vote next month to ultimately determine whether domestic paper producers were harmed by the subject imports.

U.S.-based paper manufacturers and their Indonesian and Chinese counterparts have been down this road before. In 2007, the DOC levied anti-dumping (AD) and countervailing duties (CVD) against Chinese, Indonesian and Korean paper imports, only to have it overturned by the ITC in a 5-1 vote. That process was initiated by a complaint filed by NewPage Corp.

This current case was brought last September following a complaint by NewPage, Appleton Coated, Sappi Fine Paper North America and the United Steelworkers.

The anti-dumping margins announced by DOC on imports from Indonesia were 20.13 percent and ranged from 7.6 percent to 135.83 percent on imports from China. Countervailing duties on products from Indonesia will be subject to tariffs of 17.94 percent and on Chinese imports ranging from 17.64 percent to 178.03 percent. If the ITC votes affirmatively in its upcoming injury determination, these rates will apply for the term of the relief. The ITC will vote on Oct. 19 and the transmittal of its views to DOC will occur on Nov. 4.

The companies and the USW filed unfair trade cases with the DOC and ITC on Sept. 23, 2009, alleging that certain coated paper from China and Indonesia had been dumped and subsidized, resulting in injury to the domestic industry and its employees. The paper products covered by the petitions include coated paper in sheet form used in high-quality writing, printing and other graphic applications, with a GE brightness rating of 80 or higher and weighing up to 340 grams per square meter.

Asia Pulp & Paper (APP), an exporter of coated paper from China and Indonesia, believes the DOC adopted questionable calculation methodologies in rendering its final determination, and feels "more proper" methodologies would have yielded little to no AD/CVD duties.

"While we are disappointed in (the) announcement of the final AD and CVD rates, we remain confident that the entire trade case will be thrown out at the conclusion of the International Trade Commission’s injury investigation in mid-October," said Terry Hunley, acting president, APP Americas.

"This is the second such investigation conducted in the last two years, both of which have involved exports of coated paper produced by APP," Hunley noted. "The prior investigation was terminated by the U.S. government because APP’s imports of coated paper did not injure the U.S. industry. We believe we will secure a similar result in this case. In fact, this investigation has even less basis than the last one, since the U.S. industry itself has benefited from large, direct federal subsidies for its production of the pulp used to make paper."