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    Capitol Comments

    Roll Goods Import and Export Data for 2013

    Plus, Federal chemicals reform momentum builds as House introduces reform discussion draft.

    Jessica Franken, Director of Government Affairs & Dawnee Giammittorio, Associate Director of Government Affairs INDA, Association of the Nonwoven Fabrics Industry05.12.14
    The U.S. government’s recently-released trade statistics for 2013 show a nearly 3% annual decrease in United States exports of nonwoven roll goods (categorized under Harmonized Tariff Schedule heading 5603), down from 318.6 million kilograms in 2012 to 309.6 million kilograms last year.  In 2012, we had seen an almost 10% increase over 2011 volumes  (See Table 1). Nonetheless, the dollar value of exported roll goods increased 11.7% over the previous year from $1.77 billion in 2012 to $1.97 billion in 2013 (See Table 2).  These figures comport with statistics for manufacturing exports overall—although the U.S. trade deficit narrowed in 2013 due primarily to surging energy exports, manufacturing exports lagged. Chief economist for the National Association of Manufacturers Chad Moutray calls the “sluggish growth” of exports in manufactured goods, despite global economic improvement, “one of the more frustrating storylines of 2013.”  Indeed exports for manufactured goods were up just 2.4% for the year, well below the 5.7% rise for all exports during 2013.

    Imports of roll goods to the U.S., meanwhile, grew in both the volume and dollar value over the previous year totals. The volume of imports increased 6.1% from 195.7 million kilograms in 2012 to 207.7 million kilograms in 2013, and the value of imports increased 9.2% from $960.6 million to slightly over $1 billion.

    Import/Export Markets. As Table 3 shows, just under half (47.7%) of U.S. roll goods exports remained in the U.S.-North American Free Trade Agreement territory during 2013.  This is a slight decrease in the share of 48.4% from 2012. Similarly volumes exported to both countries decreased, dropping 5.2% for Mexico and 3.1% for Canada.

    As Table 4 shows, Mexico, Canada and China remain the top three destinations for U.S. nonwoven roll goods. As with last year, the volume exported to China continued on a downward trend, dropping 18.4% from 2012 levels, following a 7.3% decline from 2011 to 2012. This is disappointing news, particularly as overall exports of U.S.-manufactured goods to China increased 18.4% in 2013, although the manufactured goods trade deficit with China still remains great.

    Other noteworthy statistics include:  U.S. exports to Germany rising 52% following an increase of 31% from 2011 to 2012, and Chile appearing on the top ten list with a striking 79% increase over 2012 levels. 

    As far as imports, China continues to be, by a wide margin, the largest importer of roll goods to the United States. Israel and Germany boosted their imports to the U.S. 29.3% and 25.4%, respectively. U.S. imports from France experienced a slight decrease (3.3%) after a jump of 29.6% in 2012. Imports from India declined again this year after surging in 2010 and 2011.

    Encouraged by strong export numbers for 2012, we were optimistic that 2013 would be another growth year for international trade in nonwoven roll goods, especially in light of President Obama’s export growth oriented National Trade Initiative and several large scale trade agreements being finalized or pending. Unfortunately, two of the most ambitious trade agreements, the Trans-Pacific Partnership (TPP) and the U.S.-European Union Transatlantic Trade and Investment Partnership (TTIP), have stalled partly due to Congress’ failure to pass Trade Promotion Authority (TPA). Hopefully TPA will pass this year, freeing the administration to negotiate these agreements on a “fast track,” thereby opening up markets for American goods. 

    Federal chemicals reform momentum builds as House introduces reform discussion draft

    As public concern about the dangers of toxic chemicals in American homes and the environment rises and a number of states and countries advance chemicals reform initiatives, the time may finally be ripe for Congress to revise the nation’s chemical laws. While most stakeholders have long agreed that the current law, the Toxic Substances Control Act of 1976 (TSCA), is outdated and ineffective, they have been unable to agree how best to reform the law. The latest attempt to tackle the seemingly impossible comes in the form of a discussion draft entitled the Chemicals in Commerce Act (CICA), released Feb. 27 by Rep. John Shimkus (R-Il 15th), Chair of the House Energy and Commerce Subcommittee on Environment and the Economy.

    The late Sen. Frank Lautenberg (D-NJ) was long the champion of chemical safety reform, introducing bills year after year that never moved due to a lack of bipartisan support. In May 2013. he surprised seasoned Washington insiders by teaming with co-sponsor Sen. David Vitter (R-LA) on a bipartisan compromise bill to revamp TSCA, the Chemical Safety Improvement Act (CSIA) S. 1009.  Unfortunately, Sen. Lautenberg died the following month and the bipartisan bill appears to be meeting the fate of all previous versions – stalling in committee.  Unlike Sen. Lautenberg’s previous bills, however, the CSIA continues to enjoy bipartisan support and is viewed as a good starting place for modernizing TSCA. Because the CICA and CSIA have many similar provisions, stakeholders are encouraged that a compromise between the two versions can be reached. 

    One of the fundamental failures of TSCA is the constraint on the Environmental Protection Agency’s (EPA) ability to address risks posed by more than 60,000 “existing” chemicals that were on the market when TSCA passed in 1976. Both the CICA and CSIA seek to address this flaw by requiring the EPA to determine on a prioritized basis whether chemical substances meet a safety standard under their intended conditions of use. Both would give the EPA authority to impose restrictions or requirements proportional to the risks posed by chemicals unable to meet the safety standard. The bills, however, do differ with respect to some important issues that will need to be ironed out, including the notification procedures for new chemical and significant new uses of existing chemicals; the extent that federal law will preempt state laws; the authority of the EPA to require testing; and protection of the confidentiality of proprietary information.

    The House Subcommittee on Environment and the Economy held a hearing Mar. 12 on the House discussion draft bill, where industry groups were generally supportive, calling the CICA a “workable, good-faith vehicle for bipartisan reform.”  Predictably, consumer and environmental groups pronounced the discussion draft’s provisions for information gathering, public protection, and deadlines inadequate, and excessive in terms of federal preemption. The House Subcommittee plans to reconvene hearings after the spring recess.  

    Moving TSCA reform through the House has long been considered more challenging than in the Senate. Now that the House shows interest in modernizing TSCA, chances for a bill moving forward have greatly increased, but don’t expect it to happen quickly.
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