Much of the talk regarding international trade wars, tariffs and duties revolves around what impact those activities will have on the automobile industry and, closer to our readership, the tire sector.
But there's another trade battle going on in a smaller corner of the rubber industry, as the main domestic source for manufacturing rubber bands has been involved in a trade dispute with importers of the goods from China and Thailand. And while the scale of this trade dispute is much smaller in scope, it is just as meaningful—and personal—to the players.
Alliance Rubber Co., the largest of the three remaining U.S. rubber band producers, began this trade battle in January by filing petitions asking for antidumping and countervailing duties against imports of rubber bands from Thailand, China and Sri Lanka. The Hot Springs, Ark., company has long been a promoter of its "Made in the U.S." status.
It argued that rubber band producers from those nations were receiving subsidies from their governments that allowed them to undercut Alliance's prices in the U.S. by up to 50 percent, an Alliance official testified in a Nov. 13 hearing before the International Trade Commission. The result has been a loss of business, production and jobs, it claimed.
In 1999, Alliance said it employed 250 and produced 25.5 million pounds of rubber bands a year. Those figures have dropped to 171 workers and 15 million pounds of production annually. It alleged the import practices cost it a coveted contract with Staples to supply private label rubber bands.
The firm said that a warehouse built in expectation of keeping that contract now sits empty, and Alliance added it can't afford traditional bonuses for its workers
Importers paint a different picture from their perspective. An executive from Encore Packaging said at the Nov. 13 hearing that any business it has taken from Alliance was earned via hard work, while claiming Alliance hadn't established a necessary presence in this area of the business. Others claimed in earlier testimony that Alliance had misrepresented the rubber band market in its petitions, and may have declined to supply Staples with the lower-end rubber band that it wanted for its private label.
As the case has worked its way through the International Trade Commission and Department of Commerce this year, Sri Lanka was dropped early on when no injury was found from its imports, leaving just China and Thailand.
Far from the billions of dollars of trade involved in the automotive- and tire-related trade disputes, the dollars involved are much smaller, and rubber band imports from the two Asian nations actually have fallen in the past two years.
According to the DOC, the value of rubber band imports from Thailand was $12.1 million in 2017, down from $15.7 million in 2015. The number was even less from China, with 2017 imports of $4.88 million down nearly 50 percent from the $9.27 million imported two years earlier.
While this is a mere drop in the ocean compared to tire imports, the impact felt by the companies and workers involved is equally proportional.