Coated Paper Trade Cases

July 19, 2010

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Although not part of the ITA’s basis for its preliminary determination, petitioners have also asserted that the undervaluation of China’s currency provides an additional unfair subsidy that should be considered by the ITA. This assertion has been further bolstered by a recent letter from U.S. Senators Sherrod Brown (D-OH) and Charles Schumer (D-NY) to Commerce Secretary Gary Locke calling for the Department to include the currency issue in its final CVD analysis and determination.

In response to petitioners’ claims and the ITA’s preliminary CVD determination, Chinese and Indonesian paper producers point to U.S. paper companies’ use of “black liquor” bio-fuels tax credits as a form of U.S. government subsidy of their own.

Following its March CVD determination, in April the ITA announced its preliminary determination that certain coated paper from China and Indonesia had been dumped—sold at less than fair value—in the U.S. market, with additional duties assessed against paper exporters from those countries.

The Commerce Department’s final rulings on both the CVD and AD cases are expected in September. Following that, the last phase in the process will occur in October or November when the ITC makes its final determination of whether the U.S. paper industry has been harmed, which will determine whether import duties will actually be imposed.

Although faced with preliminary CVD and AD findings against them, Chinese and Indonesian producers continue to argue that U.S. domestic shipments of coated paper are down because of the overall bad economy, not because of any unfair practices of theirs, and believe that the petitioners’ cases will ultimately fail as did similar petitions in 2007.

For more information, contact NPES Government Affairs Director Mark J. Nuzzaco at 703/264-7235, or e-mail: mnuzzaco@npes.org

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