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New Assessments on Imports of Paper and Paper-Based Packaging

Wednesday, January 22, 2014
Sandler, Travis & Rosenberg Trade Report

The Department of Agriculture’s Agricultural Marketing Service has issued a final rule that, effective Jan. 22, establishes a Paper and Paper-Based Packaging Promotion, Research and Information Order to maintain and expand markets for the following kinds of products.

- printing, writing and related paper, which is coated or uncoated paper, including thermal but excluding carbonless paper, that is subsequently converted into products used for printing, writing and other communication purposes, such as file folders, envelopes, catalogues, magazines and brochures

- kraft packaging paper, which is coarse unbleached, semi-bleached or fully bleached grades of paper that is subsequently converted into products such as grocery bags, multiwall sacks, waxed paper and other products

- containerboard, which is all forms of linerboard and medium that is used to manufacture corrugated boxes, shipping containers, point-of-sale displays, pallets and other products

- paperboard, which is solid bleached kraft board, recycled board and unbleached kraft board that is subsequently converted into a wide variety of end uses, including folding boxes, tubes, cans and drums, and packaging for food, beverages and other non-durable consumer products such as pharmaceuticals, clothing, footwear and cosmetics

(Tissue paper and newsprint are not covered under the order.)

The order will be financed by an assessment on importers and domestic producers that will initially be set at $0.35 per short ton. Entities that import or manufacture less than 100,000 short tons per marketing year, as well as organic paper and paper-based packaging, are exempt from this assessment.

The assessment is expected to generate about $25 million a year, which will be used to conduct marketing and educate consumers. The AMS states that if the new program preserves just 0.24% of the paper and allied products industry sales by slowing demand declines for some grades and/or increasing demand growth for others, the economy could gain 3,360 jobs.

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