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U.S. Sen. Sessions Testifies for Alabama's Paper Industry Workers

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"Manufacturing in America is declining, and our trade deficit continues to surge... If foreign companies are not forced to correct egregious practices, the result will be clear: our foreign competitors will continue to export their unemployment to the U.S., with devastating effects on the American middle class." 

U.S. Seator Jeff Sessions (Republican of Alabama) submitted testimony this week to the International Trade Commission, Washington., D.C., USA, in support of Alabama workers against an antidumping/countervailing duty (AD/CVD) case. The case, filed against China, Indonesia, Australia, Brazil, and Portugal, alleges that these countries are selling uncoated paper products below market price through substantial government support, thus threatening American jobs and communities. Packaging Corp. of America (PCA) operates a paper plant in Jackson, Ala., which employs 600 people. There are an estimated 300,000 Alabama workers associated with the pulp and paper industry in Alabama.

Text of Senator Sessions’ testimony follows:

"Chairman Broadbent, Members of the Commission, I support the efforts of the American paper industry and its workers to obtain relief from unfairly dumped and subsidized imports from Australia, Brazil, China, Indonesia, and Portugal.

"I know the pulp, paper, and textile industry well, having grown up in the area. In fact, I was pleased to be in Clarke County last week, where the Packaging Corp. of America’s plant is located, for an announcement that an OSB-plywood plant is creating an additional 20 jobs.

"Each of these jobs is critical. We cannot stand to lose any more to unfair competitors. Alabama’s pulp and paper industry provides the best jobs in the most rural and poorest regions of the state. These plants specifically benefit struggling minority populations, as they provide a paycheck for those who would likely otherwise be without work. This is the case for the PCA facility in Clarke County.

"These are good jobs. The plants are safe and provide good healthcare and retirement benefits. Truthfully, the paper industry is a critical part of the entire rural economy of Alabama. As you are aware, the benefits reach far beyond the individual employees, as loggers, equipment suppliers, (my father owned a small farm equipment company for a number of years that is now long closed) fuel suppliers, and repair-shop and land owners all depend on the income generated by this facility. Most estimates show each manufacturing job creates 2-3 times more jobs in a given community. This is especially true for the paper industry. That means an additional 1,200 jobs depend on this plant. When housing slips as it often does, the paper mills are the steadying economic force for the region.

"While the competitors are vigorous, the industry can survive if the competition is fair and restricted by natural market forces. Unfortunately, the evidence indicates that unfair trade is occurring. For rural America, such mercantilism cannot be allowed to continue.

"The preliminary dumping margins determined by the U.S. Department of Commerce tell this story. The data show that China, producing with a heavily subsidized industry, dumps these products into the United States market at 97%-193% less than the market price in the U.S. Data on other counties also show a significant burden on U.S. producers, such as 41% for Australia, 33%-42% for Brazil, 0% to 52% for Indonesia, and 30% for Portugal. The countervailing duty margins for China and Indonesia also showed the adverse levels of government subsidies. The figures were 43% to 131% for Indonesia and 6% to 126% for China, creating a double dumping and subsidy burden for U.S. producers by those nations.

"Furthermore, foreign producers are materially benefiting from their illegal market actions as they have almost doubled their market share between 2012 and 2014 from 9.6% 17.4%. Imports are surging, a trend that accelerated over the period. In fact, imports from these five nations skyrocketed 72% between 2012 and 2014. Without action from this Commission, these countries have no incentive to stop.

"The Packaging Corp. of America’s certain uncoated paper plant in Jackson, Ala., and the 600 workers it employs, are materially suffering from these foreign market manipulations. However, while the paper plant in Jackson, Ala., has survived the onslaught of foreign imports so far, the community of Courtland, Ala., has suffered greatly from illegal trading practices. In 2014, International Paper shuttered its Courtland plant, eliminating more than 1,000 jobs in that community. In fact, this plant was the largest employer in Lawrence County, Ala.

"Throughout Alabama, the paper and forest products industry employs 70,000 and generates an annual payroll of $2.2 billion. Some 850 companies sell $15 billion in forest and paper products each year. In fact, Alabama is third in the nation in paper production, and second in pulp production in the entire nation.

"The trade trend line is moving in the wrong direction. Manufacturing in America is declining, and our trade deficit continues to surge. I urge the Commission to rule in favor of relief and imposition of duties at your final determination vote in February. Against a backdrop of a broken U.S. trade policy, the work you do in imposing antidumping and countervailing duties, where appropriate, is increasingly vital. If foreign companies are not forced to correct egregious practices, the result will be clear: our foreign competitors will continue to export their unemployment to the U.S., with devastating effects on the American middle class."

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