Madison Paper buckled under big spike in Canadian imports

In announcing the closure of Madison Paper Industries, observers pointed to a one-two punch of declining domestic demand and rising imports, alongside high winter energy costs.

Federal import figures give a picture of just what the mill was up against in recent years. From July-December, imports of supercalendered paper from Canada were up 90 percent by volume and 55 percent, by price.

The figures demonstrate two parts of the problem: Canadian imports continued to gain market share in the United States and the price of those imports continued to fall.

For the end of 2015, the average imports of supercalendered paper rolls, by weight, almost doubled.

At the same time, the unit price of those imports (in dollars per kilogram), dropped sharply in July 2015, when import volumes were 264 percent higher than July 2014.

That was the same month that the U.S. Commerce Department started collecting duties on Canadian imports after a successful petition for tariffs from Madison and Verso, which together own all of the U.S. supercalendered paper production.

In response to that petition, the U.S. International Trade Commission found the volume of those imports had a serious impact on domestic producers.

Union officials said those tariffs helped, but not enough to make up for a quickly falling Canadian dollar, which kept the United States an attractive market for producers to the north.

Those import figures show the extent of the challenge the Madison mill faced as foreign imports chipped away at a steadily declining market for its paper, used in color printing applications, including magazines, directories, coupons and (gulp) retail inserts in newspapers.

Those figures and ITC findings should help convince the U.S. Department of Labor to certify the Madison mill employees to get federal money for job retraining and other transition assistance, through a fund to aid workers who lose their jobs primarily due to foreign competition.

Sens. Susan Collins and Angus King urged the DOL to consider the results of that ITC investigation and to approve those workers for funds from the Trade Adjustment Assistance program in a letter sent Thursday.

Darren Fishell

About Darren Fishell

Darren is a Portland-based reporter for the Bangor Daily News writing about the Maine economy and business. He's interested in putting economic data in context and finding the stories behind the numbers.