October 16, 2014 / 12:37 PM / 4 years ago

Canadian pulp makers urge government to pressure China on anti-dumping duties

TORONTO (Reuters) - Two Canadian paper and pulp producers on Thursday urged the federal government to put pressure on China to overturn the country’s anti-dumping duties on dissolving pulp, a cellulosic material used to produce rayon.

Vancouver, British Columbia-based Fortress Paper FTP.TO said on Thursday that it had been asking the Canadian government to petition China, on behalf of the Canadian pulp industry, to resolve the dispute equitably.

Canada filed a complaint at the World Trade Organization on Wednesday to challenge the Chinese duties. Canada says China broke WTO rules when it imposed the duties in November and April, the organization said in a statement.

In its release, Fortress said the anti-dumping duty imposed by China’s Ministry of Commerce on dissolving pulp imports from Canada, the United States and Brazil would mean about C$20 million ($17.7 million) annually in lost revenue from its specialty cellulose business.

Fortress said the duties put thousands of Canadian jobs in the dissolving pulp industry at risk, including over 300 at its mill in Thurso, Québec. In the long-term, the company added, Canada will lose out in this industry to nations unaffected by the duties.

The company said the duties had been determined in a manner contrary to international law and so far had not had any positive effect on the local price in China for dissolving pulp, which is used in apparel, textiles and automotive applications.

Separately, rival Canadian pulp producer Tembec Inc TMB.TO also called on Canadian International Trade Minister Ed Fast to enter into WTO discussions with China to resolve the dispute.

A spokeswoman for Fast on Wednesday said the anti-dumping measures were “unfounded and discriminatory” and put Canadian exporters at a disadvantage.

China is Canada’s top foreign market for dissolving pulp. It imported more than $300 million in each of the past three years, according to a trade database maintained by the International Trade Center, a United Nations-WTO joint venture.

Almost half of Canada’s 750,000 tonnes of production of the material went to China last year.

Reporting by Euan Rocha; Editing by Lisa Von Ahn

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