Economic Impact Analysis of the Fabric and
Textiles Printing, Coating, and Dyeing
NESHAP: Final Rule
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EPA452/R-03-008
February 2003
Economic Impact Analysis of the Fabric and Textile
Printing, Coating, and Dyeing NEHSAP:
Final Rule
Final Report
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Air Quality Standards and Strategies Division
Innovative Strategies and Economics Group
Research Triangle Park, North Carolina.
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CONTENTS
Section Page
ES Executive Summary ES-1
1 Introduction 1-1
2 Industry Profile 2-1
2.1 The Supply Side 2-3
2.1.1 Coating Production Process 2-4
2.1.2 Finishing Production Process 2-11
2.1.3 Costs of Production 2-13
2.2 The Demand Side 2-15
2.2.1 Product Characteristics 2-15
2.2.2 Uses and Consumers 2-15
2.2.3 Substitutes 2-18
2.3 Industry Organization 2-19
2.3.1 Market Structure 2-20
2.3.2 Manufacturing Facilities 2-22
2.3.3 Facility Employment and Economies of Size 2-22
2.3.4 Companies 2-26
2.4 Markets 2-30
2.4.1 Value of Shipments 2-31
2.4.2 Market Prices 2-33
2.4.3 Future Outlook 2-33
2.4.4 International Trade 2-34
3 Regulatory Control Costs 3-1
3.1 National Control Cost Estimates 3-1
3.1.1 Compliance Costs for the Textile Printing and Coating
Subcategory 3-1
iii
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3.1.2 Compliance Costs for the Textile Slashing, Dyeing, and
Finishing Subcategory 3-3
3.1.3 Estimated National Costs of the Proposed Rule 3-4
4 Economic Impact Analysis: Methods and Results 4-1
4.1 Markets Affected by the Proposed NESHAP 4-1
4.2 Conceptual Approach 4-2
4.2.1 Supply 4-3
4.2.2 Demand 4-3
4.2.3 Baseline and With-Regulation Market Equilibrium 4-4
4.2.4 Company-Level Impacts 4-7
4.3 Economic Impact Results 4-7
4.3.1 Market-Level Impacts 4-7
4.3.2 Social Cost 4-8
4.3.3 Estimated Company Impacts 4-9
5 Other Impact Analyses 5-1
5.1 Small Business Impacts 5-1
5.2 Energy Impacts 5-3
5.2.1 Increase in Energy Consumption 5-3
5.2.2 Reduction in Energy Consumption 5-3
5.2.3 Net Impact on Energy Consumption 5-5
References R-l
Appendix A Model Data Set and Specification A-l
IV
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LIST OF FIGURES
Number Page
2-1 Fabric Printing, Coating, and Dyeing Source Category 2-4
2-2 Extrusion Coating Plant 2-5
2-3 Knife-Over-Roll Coating 2-9
2-4 Reverse-Roll Coating 2-10
2-5 Rotary Screen Coating 2-10
2-6 Transfer Coating 2-11
2-7 Extrusion Coating 2-11
2-8 Lamination Coating 2-12
2-9 Gravure Print Coating 2-12
2-10 Impregnation Coating 2-12
4-1 Market Equilibrium without and with Regulation: Printing and Coating
Subcategory 4-5
4-2 Market Equilibrium without and with Regulation: Slashing, Dyeing, and
Finishing Subcategory 4-6
v
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LIST OF TABLES
Number Page
2-1 Types of Primary Products in Coated and Finished Fabrics Industries
(NAICS 313320, 313311,313312, and 313210) 2-2
2-2a Production Costs for Fabric Coating Mills (NAICS 313320) 2-14
2-2b Production Costs for Fabric and Textile Finishing Mills (NAICS 313311,
313312, 3132109, 313210P, 313210U) 2-14
2-3 Variables Essential for Product Development Derived from Applications
of Coated and Finished Materials 2-16
2-4 Coated Fabric Products and the Materials Used to Make Them 2-17
2-5 Coated Fabric Demand by Product Market 2-19
2-6 Coated Fabrics: Principal U.S. Industries and Factors Affecting Demand ... 2-20
2-7 Measure of Market Concentration for Fabric Coatings and Finishings
Companies: 1997 2-21
2-8 Textile Coating Facility Locations 2-23
2-9 Textile Finishing Facility Locations, by State 2-24
2-10 Facility-Level Employment and Size Economy for Fabric Coating and
Finishing Industry, 1997 2-25
2-11 Parent Companies 2-27
2-12 Employment Size Distribution of Small Companies 2-30
2-13 Sales Size Distribution of Small Companies 2-31
2-14 General Trends: 1985-1998 2-32
2-15 Coated Fabrics Shipments by Type: 1989-2008 ($106) 2-33
2-16 Coated Fabrics Pricing Trends: 1989-2008 ($106) 2-34
2-17 Coated Fabrics Demand (million sq. yards) 2-35
2-18 Coated Fabrics Foreign Trade: 1989-2008 ($106) 2-36
3-1 Summary of Textile Coating and Printing Subcategory Model and
Nationwide Control Costsa 3-2
3-2 Distribution of Maximum Facility Costs for Finishing Reformulation" 3-4
3-3 Summary of Textile Coating, Printing, Slashing, Dyeing, and Finishing
NESHAP 3-5
VI
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4-1 Market-Level Impacts: 1997 4-8
4-2 Distribution of Social Costs: 1997 4-10
4-3 Estimated Company Impacts 4-11
5-1 Cost-to-Sales Ratios for Small Companies in the Fabric Coating Subcategory 5-2
5-2 Summary of Fabric Coating and Printing Subcategory Model and
Nationwide Energy Impacts 5-4
vn
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EXECUTIVE SUMMARY
The Environmental Protection Agency's (EPA's) Office of Air Quality Planning and
Standards (OAQPS) has developed a National Emission Standard for Hazardous Air
Pollutants (NESHAP) under Section 112 of the Clean Air Act (CAA) Amendments of 1990
to limit air emissions from the production of coated, printed, dyed, slashed, or finished
fabrics. This document analyzes the economic impacts of the NESHAP on the fabric coating
and finishing industries and their customers.
Coated fabric products fall under the North American Industry Classification System
(NAICS) 313320, Fabric Coating Mills. Finished fabrics are categorized under NAICS
313311, Broadwoven Fabric Finishing Mills; NAICS 313312, Textile and Fabric Fishing
(Except Broadwoven Fabric) Mills; and part of NAICS 313210, Broadwoven Fabric Mills.
All the affected NAICS codes are part of the textile industry, which has experienced difficult
market conditions associated with increased international competition over the past decade.
This has resulted in plant closures, restructuring of ownership, increasing automation, and
some company bankruptcies. This recent industry experience is reflected in EPA's modeling
of impacts in the finishing sector.
EPA has determined that textile coating and finishing operations are a source of
hazardous air pollutants (HAPs). The principal source of HAPs is the use of solvents in the
production process. Emissions from the production of coated and finished fabrics come from
various stages of the industrial process. The preparation of coating/finishing materials in
mills, mixers, and tanks prior to application; the coating/finishing application area; the flash-
off area; and the drying ovens are all sources of HAP emissions. These processes are
described in detail in Section 2.1. EPA combined information from a facility-specific
database with information from publicly available sources to profile the industry.
EPA used detailed facility-specific operations data provided by industry to assess
baseline emissions and estimate the costs of complying with the NESHAP (See Section 3).
For the coating and printing subcategory, compliance activities include installing and
operating control equipment as well as monitoring, recordkeeping, and reporting (MRR)
activities. EPA developed compliance cost estimates for a variety of model plants. Most
ES-1
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facilities in the coating subcategory are expected to incur some compliance costs above MRR
costs. For the finishing, dyeing, and slashing subcategory, EPA identified 7 facilities that
would be required to reformulate their finishing chemicals to reduce formaldehyde
emissions. All other facilities in the finishing subcategory are estimated to incur only MRR
costs. Estimated national costs of the regulation are shown in Table ES-1.
Table ES-1. Summary of Textile Coating, Printing, Slashing, Dyeing, and Finishing
NESHAP
Nationwide Total Nationwide Total
Capital Investment Annual Cost
Nationwide Cost Component ($106) ($106)
Coating and printing subcategory control costs
Dyeing and finishing subcategory
reformulation costs
Source category MRR costs
Nationwide total compliance costs
17.6
1.2
18.8
5.6
7.5
1.4
14.5
To analyze the impacts of the NESHAP, EPA constructed a model of national
markets for finished and coated fabrics. EPA's analysis, reported in Section 4, projects that
market impacts of the NESHAP will be very small. Production of coated fabrics is projected
to decline by less than one-tenth of a percent, as is production of finished fabrics. EPA's
facility database contained identifying information for only a subset of the facilities, so EPA
collected information on companies owning fabric coating and finishing facilities from
publicly available financial databases. Using these data, EPA compared the minimum,
median, mean, and maximum costs of compliance for its model plants with company sales
revenues. EPA's cost-to-sales analyses indicate that, based on median compliance costs, the
majority of companies would find complying with the NESHAP affordable.
EPA paid particular attention to assessing impacts to small businesses in the industry.
Both the fabric coating and finishing industries have a large share of small businesses. For
most of the NAICS codes affected by the NESHAP, small businesses are defined as those
with 1,000 or fewer employees. Of 248 companies identified in publicly available financial
ES-2
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databases as owning facilities in the applicable NAICS codes, 181 are classified as possibly
small (this total includes companies without employment data). Thus, EPA was aware that
there was the potential to adversely impact small businesses. In the finishing subcategory,
only 7 facilities, owned by 5 companies, incur significant costs. Of the 5 companies, only
one is identified, and it is not a small business. Thus, in the finishing subcategory, only at
most four small businesses could incur substantial costs. In the coating subcategory, costs
are estimated based on model plants, and EPA does not generally have sufficient data to
estimate the costs for individual facilities. To assess potential impacts on small businesses
owning fabric coating facilities, therefore, EPA collected additional process and control data
for small businesses that could potentially incur costs. EPA estimated facility-specific
compliance costs for 18 small businesses. Of these, only three are projected to incur costs
exceeding 1 percent of their baseline sales. Only one of these is projected to incur costs
exceeding three percent of baseline sales (3.2 percent). EPA therefore does not believe that
the rule will impose significant impacts on a substantial number of small businesses.
ES-2
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SECTION 1
INTRODUCTION
The Environmental Protection Agency's (EPA's) Office of Air Quality Planning and
Standards (OAQPS) has developed a National Emission Standard for Hazardous Air
Pollutants (NESHAP) under Section 112 of the Clean Air Act (CAA) Amendments of 1990
to limit air emissions from the production of coated, printed, dyed, slashed, or finished
fabrics. This document analyzes the economic impacts of the NESHAP on the fabric coating
and finishing industries and their customers.
Coated fabric products fall under the North American Industry Classification System
(NAICS) 313320, Fabric Coating Mills. Finished fabrics are categorized under NAICS
313311, Broadwoven Fabric Finishing Mills; NAICS 313312, Textile and Fabric Fishing
(Except Broadwoven Fabric) Mills; and part of NAICS 313210, Broadwoven Fabric Mills.
The fabric coatings industry produces a wide variety of products, all of which are created by
coating a textile substrate with various polymers. The final product takes on characteristics
of both the substrate and the coating. Products made by the industry include air bags,
clothing, wall coverings, upholstery, tarpaulins, tents, air inflated structures, and pond liners.
The almost infinite variety of combinations of coating and fabric materials allows for the
production of highly technical products with specialized performance characteristics.
Consequently, coated fabrics can be found serving many different functions in the
manufacturing, road building, apparel, aircraft, automotive, boating, transportation, outdoor
equipment, mining, and other industries. Despite the wide variety of products, they are all
created using similar processes. A coating is dipped, rolled, laminated, or spread onto a
fabric substrate.
The textile finishing industry is mostly engaged in bleaching, dyeing, printing, and
finishing (i.e., preshrinking, calendering, and napping) fabrics, yarn, or raw stock. Fabrics
are finished to enhance their performance attributes (e.g., to impart permanent-press
characteristics). Most companies do at least some commission work, that is, dyeing and
finishing fabrics that are owned by other companies. Finished fabrics serve three markets:
apparel, home furnishings, and industrial. All the affected NAICS codes are part of the
1-1
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textile industry, which has experienced difficult market conditions associated with increased
international competition over the past decade. This has resulted in plant closures,
restructuring of ownership, increasing automation, and some company bankruptcies. To
reflect this recent industry experience, EPA has assumed that textile finishers will be unable
to increase the price of their products in response to the rule. Foreign producers are assumed
to increase their output to compensate for any reductions in domestic output, so that market
price and quantity in the textile finishing sector remain unchanged due to the rule.
EPA has determined that textile coating and finishing operations are a source of
hazardous air pollutants (HAPs). The principal source of HAPs is the use of solvents in the
production process. Emissions from the production of coated and finished fabrics come from
various stages of the industrial process. The preparation of coating/finishing materials in
mills, mixers, and tanks prior to application; the coating/finishing application area; the flash-
off area; and the drying ovens are all sources of HAP emissions. These processes are
described in detail in Section 2.1. EPA combined information from a facility-specific
database with information from publicly available sources to profile the industry.
EPA used detailed facility-specific operations data provided by industry to assess
baseline emissions and estimate the costs of complying with the NESHAP (See Section 3).
For the coating and printing subcategory, compliance activities include installing and
operating control equipment as well as monitoring, recordkeeping, and reporting (MRR)
activities. EPA developed compliance cost estimates for a variety of model plants. Most
facilities in the coating subcategory are expected to incur some compliance costs above MRR
costs. For the finishing, dyeing, and slashing subcategory, EPA identified seven facilities
that would be required to reformulate their finishing chemicals to reduce formaldehyde
emissions. All other facilities in the finishing subcategory are estimated to incur only MRR
costs.
To analyze the impacts of the NESHAP, EPA constructed a model of national
markets for finished and coated fabrics. EPA's analytical approach and results are described
in Section 4 and Appendix A.
EPA paid particular attention to assessing impacts to small businesses in the industry.
Both the fabric coating and finishing industries have a large share of small businesses. For
most of the NAICS codes affected by the NESHAP, small businesses are defined as those
with 1,000 or fewer employees. Of 248 companies identified in publicly available financial
databases as owning facilities in the applicable NAICS codes, 181 are classified as possibly
1-2
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small (this total includes companies without employment data). Thus, EPA was aware that
there was the potential to adversely impact small businesses. EPA's analysis of potential
impacts on small businesses and on energy consumption are described in Section 5.
1-3
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SECTION 2
INDUSTRY PROFILE
This industry profile provides a basic understanding of the fabric coating, printing,
slashing, dyeing, and finishing operations to support the economic impact analysis (EIA) of
the NESHAP. Coated fabric products fall under the North American Industry Classification
System (NAICS) 313320 Fabric Coating Mills. Finished fabrics are categorized under
NAICS 313311 Broadwoven Fabric Finishing Mills; NAICS 313312, Textile and Fabric
Finishing (Except Broadwoven Fabric) Mills; and part of NAICS 313210, Broadwoven
Fabric Mills. Table 2-1 lists the textile mill products produced by affected entities along
with the respective NAICS codes of the industries to which those entities belong.
The fabric coatings industry produces a wide variety of products, all of which are
created by coating a textile substrate with various polymers. The final product takes on
characteristics of both the substrate and the coating. Products made by the industry include
air bags, clothing, wall coverings, upholstery, tarpaulins, tents, air inflated structures, and
pond liners. The almost infinite variety of combinations of coating and fabric materials
allows for the production of highly technical products with specialized performance
characteristics. Consequently, coated fabrics can be found serving many different functions
in the manufacturing, road building, apparel, aircraft, automotive, boating, transportation,
outdoor equipment, mining, and other industries. Despite the wide variety of products, they
are all created using similar processes. A coating is dipped, rolled, laminated, or spread onto
a fabric substrate.
The textile finishing industry is mostly engaged in bleaching, dyeing, printing, and
finishing (i.e., preshrinking, calendering, and napping) fabrics, yarn, or raw stock. Fabrics
are finished to enhance their performance attributes (e.g., to impart permanent-press
characteristics). Most companies do at least some commission work, that is, dyeing and
finishing fabrics that are owned by other companies. Finished fabrics serve three markets:
apparel, home furnishings, and industrials. Apparel and home furnishings account for 75 to
80 percent of broadwoven fabric production in the United States (Marlow-Ferguson, 2001).
2-1
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Table 2-1. Types of Primary Products in Coated and Finished Fabrics Industries
(NAICS 313320, 313311, 313312, and 313210)
Industry/Primary Product
NAICS Code
Fabric Coating Mills (NAICS 313320)
Vinyl-coated fabrics, including expanded vinyl coated
Rubber-coated fabrics
Other coated or laminated fabrics and coated yarns, not rubberized
Broadwoven Fabric Finishing Mills (NAICS 313311)
Finished cotton broadwoven fabrics (not finished in weaving mills)
Job or commission finishing of cotton broadwoven fabrics
Finished manmade fiber and silk broadwoven fabrics (not finished in weaving
mills)
Job or commission finishing of manmade fiber and silk broadwoven fabrics
Finished broadwoven wool fabrics and felts (finished in weaving mills)
Textile and Fabric Finishing (Except Broadwoven Fabric) Mills (NAICS
313312)
Finished fabrics (except broadwoven) and other finished textiles
Broadwoven Fabric Mills (NAICS 313210)
Finished cotton broadwoven fabrics (finished in weaving mills)
Finished manmade fiber and silk broadwoven fabrics (finished in weaving mills)
Finished broadwoven wool fabrics and felts (finished in weaving mills)
3133201
3133203
3133205
3133111
3133113
3133115
3133117
3133119
3133120
3132109
313210P
313210U
Sources: U.S. Census Bureau. 1999a. Broadwoven Fabric Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999b. Broadwoven Fabric Finishing Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999c. Textile and Fabric Finishing (Except Broadwoven Fabric) Mills. 1997
Economic Census: Manufacturing—Industry Series.
.
U.S. Census Bureau. 1999d. Fabric Coating Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
2-2
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EPA has determined that textile coating and finishing operations are a source of
hazardous air pollutants (HAPs). The principal source of HAPs is the use of solvents in the
production process. Emissions from the production of coated and finished fabrics come from
various stages of the industrial process. The preparation of coating/finishing materials in
mills, mixers, and tanks prior to application; the coating/finishing application area; the flash-
off area; and the drying ovens are all sources of HAP emissions. These processes are
described in detail in Section 2.1. Emissions are dealt with by using a capture and a control
device. Given the similarity among sources, it is not surprising that similar abatement
technologies are used across the industry. Capture devices are typically covers, vents, hoods,
and partial or total enclosures (EPA, 1988). The most common control devices are
incinerators and absorbers.
This profile presents background information on these topics organized within a
conventional economic framework.
• Section 2.1 includes a description of the production process and its costs.
• Section 2.2 is an examination of the demand side of the industry, which includes
the characteristics, uses, and consumers of coated/finished fabric products and
substitution possibilities in consumption.
• Section 2.3 discusses the industry's organization and provides information on
both market structure and companies that own potentially affected plants (i.e.,
size and location data and their financial characteristics). Special attention is
given to data on small businesses as required by the Small Business Regulatory
Enforcement and Fairness Act (SBREFA) and the Regulatory Flexibility Act
(RFA).
• Section 2.4 presents the market data to be used in the EIA. This section provides
data on production, consumption, exports and imports, and prices in industries
affected by this NESHAP.
2.1 The Supply Side
This section describes the supply side of the textile coating and finishing industry.
Figure 2-1 presents basic textile processes (i.e., dry and wet processing) related to fabric
printing, coating, dyeing, and finishing. The first part of this section illustrates the coating
process and describes materials used in the production process and production techniques,
followed by a brief description of the finishing production process. A discussion of
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Yarn and
Thread
Formation
Heat-
ietting
Dry Pro
Woven or
Knitted Fabric
Formation
r Sla
(Wove
: hing
n Fabric)
cessing
I
Nonwoven carpet and
Formation Rug Formation
1
1 Bonding 1 I Heat-betting
Natural
Fabric Pr
iber and I | Dyeint
jparationl 1 Finis
coatinc
nd/or|
ating
Figure 2-1. Fabric Printing, Coating, and Dyeing Source Category
production costs gives a detailed summary of the costs suppliers face in the production of
coated and finished fabric products.
2.1.1 Coating Production Process
A similar production process is used to create a wide array of different products in the
fabric coatings industry. All products are composed of a fabric substrate to which a polymer
coating is applied, giving the product characteristics of the coating and the fabric. The fabric
gives the product strength, structure, and flexibility. The coating significantly enhances the
fabric's performance capabilities and provides qualities such as water repellency, flame
retardence, chemical resistance, increased strength, and abrasion resistance. Coatings are
composed of the polymer base, solvents, pigments, plasticizers, lubricants, and fillers. These
ingredients are prepared in mills and mixers to ready the material for application to the
fabric. The coating is applied using a variety of techniques that dip, roll, or spread the
coating onto the fabric material. The process must ensure that the fabric is not damaged
during coating application. After application, the product passes through a flash-off area on
its way to the drying and curing ovens. These ovens mark the final stage of the production
2-4
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process, where the coating is fused to the substrate. A diagram of the production process is
shown in Figure 2-2.
Q
I. j
\ ' 1 V
"">. v.v.vv—.-••". -v ;_»
Figure 2-2. Extrusion Coating Plant
Source: Wypych, J. 1988. Polymer Modified Textile Materials. New York: John Wiley & Sons.
2.1.1.1 Substrates
The substrate used depends on the type of product desired. Characteristics such as
tear strength, tensile strength, dimensional stability, and flexibility are heavily influenced by
the choice of the textile material and the way in which it is constructed. The strength and
weight of a fabric depend on the construction method, the size and weight of the yarn, and
the number of yarns per unit area in the fabric. The most common fabric construction types
are weaves, knits, and nonwoven fabrics. Woven fabrics are very strong and are resistant to
elongation. Knitted substrates allow the fabric to be stretched and contoured. Stretching
allows for tear resistance, but the coating must be able to stretch and flex along with the
fabric. Nonwoven fabrics are less expensive to construct but are not strong unless they are
2-5
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coated. Unlike knits and weaves, a coating must be used to impart stability to a nonwoven
fabric.
Cotton, nylon, polyester, polypropylene, rayon, glass, and blends are the most
common types of textile materials. Among these, polyester, cotton, and nylon accounted for
over 90 percent of coated fabrics sold in 1998 (Industry News, 1999). Nylon is the strongest
material used in coated fabrics. Its performance qualities include good abrasion resistance,
high tensile strength, wet strength, excellent flexibility, and elasticity, and it can be heat set
to reduce shrinkage. Although sunlight degrades its performance characteristics, the coating
can eliminate this problem.
Polyester is not unlike nylon and is used in many similar applications. It is the most
commonly used substrate fiber (Industry News, 1999). Although polyester is more resistant
to environmental degradation than nylon, the application of coatings is more problematic.
The fibers have a very smooth surface that creates bonding difficulties. Polypropylene is
very inexpensive and has the highest weight-to-strength ratio among common fibers. Like
polyester, it is difficult to apply a durable coating to polypropylene. It is also susceptible to
heat damage.
Cotton absorbs and transmits moisture very easily and is commonly used in apparel
products. It can act as a barrier under intense heat and is stronger when wet. Rayon is a
synthetic form of cotton; it is not as strong as cotton and tends to shrink. Mechanical
adhesion to rayon is difficult, but chemical adhesion and dyes are easily imparted to the
fabric. Glass is used in conveyor belts and other applications where rigid reinforcement is
needed. It resists high temperatures, is chemically inert, and has high tensile strength, but it
breaks easily when bent. High-strength fibers such as kevlar and other carbon fibers are used
in the industry for specialized applications.
2.1.1.2 Coatings
The most common coating materials used in the industry are vinyl (PVC),
polyurethane, and rubber compounds. Other compounds, such as acrylic and teflon, are also
used to produce coated fabrics. PVC is often the least expensive coating material, but it does
not always provide the desired product performance qualities. There is no unique solution to
polymer choice in coatings because different materials can be used to achieve similar results
in the end product. The manufacturer's choice of polymer is affected by polymer properties,
2-6
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polymer availability, cost analysis, coating equipment to be used, tradition, and
environmental protection (Wypych, 1988).
Prior to application, base polymers are mixed in tanks with plasticizers and solvents
to adjust viscosity. The viscosity of the coating must permit flow around the fiber surface
(Kroschwitz, 1986). Pigments, lubricants, stabilizers, and fillers are also added to the
mixture to form the coating material. From the mixing tanks, the coating is transported to
the line of production, where it is applied using various techniques discussed later in this
report.
PVC is the most commonly used polymer. It is inexpensive and resistant to
combustion, chemicals, aging, and abrasion, and it can be applied to the substrate using a
variety of techniques. With the use of plasticizers, PVC can be processed into a soft,
manageable compound that can be easily applied to a fabric. PVC is used to produce coated
products such as tarpaulins, tents, roofing materials, greenhouses, boat covers, boats,
conveyor belts, pool covers, rainwear, luggage, automotive upholstery, and a variety of
chemical protective clothing products [i.e., vapor protective or liquid-splash protective suits]
(Wypych, 1988).
Polyurethane is another common coating type that can be used for a wide variety of
products such as tents, life vests, evacuation slides, flexible fuel storage tanks, and apparel
items (Howe-Grant, 1993). Inflatable boats, rainwear, luggage, automotive upholstery, water
storage bags, food conveyor belts, and fuel hoses are also made with polyurethane coatings
(Wypych, 1988). They provide ultraviolet protection and toughness and can impart a
leather-like feel to the fabric. Like PVC, polyurethanes can create a clear protective finish to
decorative products (such as wall coverings). Polyurethane coatings provide more protection
from abrasion than PVC but are less elastic.
Rubber or elastomer coatings make up another category of commonly used coatings
in the industry. There are an extremely large number of variations of available elastomers,
including natural rubber, silicones, acrylics, styrene-butadiene (SBR), polyisoprene, and
many more. These different materials can be used to create products that are oil, water, and
flame resistant. Rubber or elastomer coatings are used in both latex and solid forms.
Rubber-coated products are used for rainwear, boats, lifeboats, gymnasium mats, aprons,
truck covers, containers, garbage chutes, neoprene wetsuits, roofing materials, protective
garments, inflated structures, balloons, and fumigation covers (Wypych, 1988; Howe-Grant,
2-7
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1993). Solvents are often used with rubber coating processes and add high levels of HAP
emissions to the production process.
Acrylic and teflon are also used extensively as coating materials. Acrylic resins are
the most common material for a class of products known as geotextiles. These fabric
products are used in earth structures. Drainage projects, asphalt construction, erosion
control, mining, road building, and earth stabilization projects all use geotextiles (Wypych,
1988). Teflon is used to coat glass fabrics in industrial applications such as warehouses,
sports halls, exhibition tents, stadiums, swimming pools, gaskets, conveyor belts, public
meeting facilities, and other large structures (Wypych, 1988).
The list of products presented above illustrates the wide variety of uses for coated
fabrics. It is important to note that the same products may be produced with different
materials. As stated earlier, the choice of the coating material depends on a variety of
factors, including end use, cost, traditional local techniques, environmental concerns, and the
availability of materials and equipment.
2.1.1.3 Coating Application Processes
There are various ways to apply coating to the fabric substrate. The method chosen
depends on the properties of the substrate and the coating material. In all application types,
the fabric is placed under tension and is directed through a system of rollers. Rollers are
combined with various types of equipment used to apply the coating material. The most
commonly used techniques are reverse-roll coating, calendering, knife-over-roll coating,
transfer coating, impregnation, direct-gravure coating, lamination, rotary-screen, and
extrusion coating. The coating is usually heated, and care must be taken to ensure that the
fabric is not damaged by high temperatures. The coating application process is a source of
HAP emissions, which come primarily from using solvents in coating materials.
In knife-over-roll coatings, the fabric passes under a blade that spreads the coating
onto the fabric. The coating material is placed in front of the knife, and the distance between
the knife and the fabric regulates the thickness of the coating (see Figure 2-3). This method
is most commonly used in the production of polyurethane-coated fabrics (Howe-Grant,
1993). This process often requires the heavy use of solvents, which creates a larger amount
of HAP emissions. The technique is usually used with slow application rates and is most
common with thin coatings.
2-8
-------
Coating
compound
Figure 2-3. Knife-Over-Roll Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopedia of Polymer
Science and Engineering. Volume 6: Emulsion
Polymerization to Fibers, Manufacture. New York:
John Wiley & Sons.
The most expensive coating technique is reverse-roll coating, which uses three
precisely ground steel rollers to apply a coating to the fabric (see Figure 2-4). The rolls must
have precisely regulated drive speeds to obtain the desired coating effect. Reverse-roll
coating is versatile and can be used with the widest variety of coating viscosities and
production speeds. The distance between the transfer roll and the backing roll determines the
thickness of the coating. This technique commonly makes use of solvents.
Reverse-roll and knife-over-roll techniques often result in heavy penetration of the
coating into the fabric. A method known as rotary screen coating is often used to avoid this
result. In this technique, the coating material is placed inside a screen roller, and the fabric
material passes underneath. The coating passes through the screen and onto the substrate.
The size of the holes in the rotary screen regulate coating thickness (see Figure 2-5).
2-9
-------
Figure 2-4. Reverse-Roll Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopedia
of Polymer Science and Engineering.
Volume 6: Emulsion Polymerization to
Fibers, Manufacture. New York: John
Wiley & Sons.
Figure 2-5. Rotary Screen Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopedia
of Polymer Science and Engineering.
Volume 6: Emulsion Polymerization to
Fibers, Manufacture. New York: John
Wiley & Sons.
Other less common coating techniques include transfer coating, extrusion and
lamination coating, direct gravure coating, and impregnation coating (see Figures 2-6
through 2-10). The transfer technique applies a coating to release paper using a reverse-roll
or knife-over-roll technique. The paper is then pressed against the substrate, which
subsequently peels the coating from the paper. Decorative effects are obtained by embossing
designs on the release paper, so this process is commonly used for decorative products.
Extrusion and lamination coating processes apply separate films to the fabrics at high speeds
and the two are fused together using a melting or adhesive process. The thinnest coatings (as
thin as .003 mm) are applied using a direct gravure technique (Kroschwitz, 1986). A roller
applies an extremely low viscosity compound, which passes by a blade that regulates the
amount of coating applied to the fabric. Impregnation coating uses a dipping technique to
apply material to the substrate. The fabric passes through rollers and is submerged in the
coating material before surfacing and passing through another set of rollers.
The choice of coating technique controls coating thickness, which in turn influences
water absorptivity, water permeability, weight, dimensional stability, tensile strength, tear
strength, transparency, and elasticity. Different techniques can achieve similar results, and
2-10
-------
Extrusion
d it-
Rub ber
pressure roll
Figure 2-6. Transfer Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopedia
of Polymer Science and Engineering.
Volume 6: Emulsion Polymerization to
Fibers, Manufacture. New York: John
Wiley & Sons.
Figure 2-7. Extrusion Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopedia
of Polymer Science and Engineering.
Volume 6: Emulsion Polymerization to
Fibers, Manufacture. New York: John
Wiley & Sons.
the choice is a function of cost, equipment availability, traditional preference, and the desired
product characteristics.
2.1.2 Finishing Production Process
Fabric finishing improves the appearance, texture, and/or performance of fabrics. In
general, finishing can be accomplished through the following three steps (Marlow-Ferguson,
2001):
• Fabric preparation: bleaching and preparing fabrics with chemical agents
(hydrogen peroxide). The purpose of bleaching is to decolorize naturally present
pigments into whitened fabric without damaging the fabric (EPA, 1998);
• Fabric coloration: dyeing and printing fabrics performed by various dyeing
methods and printing machines, respectively. Main types of dye methods used in
the industry include stock dyeing, package dyeing, skein dyeing, beck dyeing, jet
dyeing, beam dyeing, jig dyeing, paddle dyeing, rotary dyeing, and continuous
dyeing. As to fabric printing, rotary screen printing, flat-bed screen printing,
engraved roller printing, and heat transfer printing are the most commonly used
techniques (EPA, 1998); and
2-11
-------
Figure 2-8. Lamination Coating
Figure 2-9. Gravure Print Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopedia of Source: Kroschwitz, J.I. ed. 1986. Encyclopedia of
Polymer Science and Engineering. Volume Polymer Science and Engineering. Volume
6: Emulsion Polymerization to Fibers, 6: Emulsion Polymerization to Fibers,
Manufacture. New York: John Wiley & Manufacture. New York: John Wiley &
Sons. Sons.
"X
» ( '
\\ ' : ah- ,; ; -
•. -f")
Figure 2-10. Impregnation Coating
Source: Kroschwitz, J.I. ed. 1986. Encyclopediaof Polymer Science and Engineering. Volume 6:
Emulsion Polymerization to Fibers, Manufacture. New York: John Wiley & Sons.
2-12
-------
• Fabric finishing: finishing through either dry (mechanical) finishing or wet
(chemical) finishing. Dry finishing includes sueding, sanding, shearing,
calendering, embossing, and napping. Wet finishing consists of
preshrinking/sanforizing, mercerization, or heat-setting. During finishing
processes, chemical finishes are applied for wrinkle resistance, water repellency,
flame retardence, mildew proofing, and wash-and wear characteristics (Marlow-
Ferguson, 2001).
2.1.3 Costs of Production
The three primary costs of production for the fabric coatings and finishings industry
are capital expenditures, labor expenses, and cost of materials.
• As shown in Tables 2-2a and 2-2b, capital expenditures totaled $814 million in
1997 for the coating and finishing industry. During the same year, this industry
spent more than $3 billion and $10 billion on its labor and materials for
production, respectively (U.S. Census Bureau, 1999a, b, c, d).
• Table 2-2a shows the fabric coating industry spent $74 million on capital, $505
million on labor, and $1.3 billion (69 percent of total production costs) on
materials in 1997 (U.S. Census Bureau, 1999a, b, c, d).
- For capital expenditures, machinery and equipment accounted for 84 percent
of the costs, while buildings and other structures made up the remaining 16
percent.
- About 76 percent of labor costs were spent on annual payroll, and the
remainder went toward fringe benefits.
- Approximately 92 percent of materials costs were for materials, parts,
containers, and other such materials. The remaining 8 percent was made up
by resales, fuels purchased, electricity, and contract work.
• As Table 2-2b presents, the finishing industry allocated $740 million for capital
purchases, $3 billion for labor, and $9.7 billion for materials (about 71 percent of
total production costs) in 1997 (U.S. Census Bureau, 1999a, b, c, d).
- Seventeen percent of the capital costs were spent on buildings and other
structures, while 8 percent were for machinery and equipment purchases.
- As to labor expenditures, annual payroll accounted for 85 percent of the costs,
while fringe benefits made up the remaining 15 percent.
2-13
-------
Table 2-2a. Production Costs for Fabric Coating Mills (NAICS 313320)
Total cost of production
Total capital expenditures
Buildings and other structures
Machinery and equipment
Total labor expenditures
Annual payroll
Fringe benefits
Total cost of materials
Materials, parts, containers, etc.
Resales
Fuels
Purchased electricity
Contract work
Total Cost of
Production, 1997
($106)
1,881
74
12
62
505
383
122
1,301
1,203
38
20
23
18
Percentage of Total
Cost of Production
100.0%
4.0%
0.7%
3.3%
26.9%
20.4%
6.5%
69.2%
63.9%
2.0%
1.1%
1.2%
0.9%
Source: U.S. Census Bureau. 1999d. Fabric Coating Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
Table 2-2b. Production Costs for Fabric and Textile Finishing Mills (NAICS 313311,
313312, 3132109, 313210P, 313210U)
Total cost of production
Total capital expenditures
Buildings and other structures3
Machinery and equipment3
Total labor expenditures
Annual payroll
Fringe benefits3
Total cost of materials
Materials, parts, containers, etc.3
Resales3
Fuels3
Purchased electricity3
Contract work3
Total Cost of
Production, 1997
($106)
13,683
740
128
60
3,251
2,788
463
9,692
6,739
129
286
222
244
Percentage of Total
Cost of Production
100.0%
5.4%
0.9%
3.4%
23.8%
20.4%
3.4%
70.8%
49.3%
0.9%
2.1%
1.6%
1.8%
3 Values are reported for NAICS 313311 and 313312 only.
Sources: U.S. Census Bureau. 1999a. Broadwoven Fabric Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999b. Broadwoven fabric Finishing Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999c. Textile and Fabric Finishing (Except Broadwoven Fabric) Mills. 1997
Economic Census: Manufacturing—Industry Series.
.
2-14
-------
- Approximately 70 percent of materials costs were for materials, parts,
containers, and other such materials. The remaining 30 percent was made up
by resales, fuels purchased, electricity, and contract work.
2.2 The Demand Side
This section gives a detailed illustration of the demand side of the fabric coatings
industry as well as the finishing industry. It starts by describing coated and finished fabric
products and then discusses the uses and consumers of coated/finished fabrics and possible
substitutes.
2.2.1 Product Characteristics
The characteristics of coated and finished fabrics are a function of the type of fabric
used and the coating/finishing that is applied to it. The fabric provides the foundation for the
product's strength and flexibility characteristics. Coating and finishing improve fabric
appearance, wrinkle resistance, durability, abrasion resistance, water repellency, flame
retardence, oil resistance, chemical resistance, strength, and/or flexibility.
Table 2-3 lists the wide variety of product characteristics demanded by consumers of
coated and finished fabrics. The techniques used to achieve these product characteristics are
variable, and different materials and manufacturing techniques can be used to obtain the
same characteristics in the final product. Both coated and finished fabric products are
produced to meet specialized requirements determined by the end use. For example, the
product may be relatively simple and inexpensive or highly technical and expensive,
depending on how it will be used.
2.2.2 Uses and Consumers
The fabric coating and finishing industry produces products for a wide variety of uses
and consumers. Coated and finished fabrics can be used for indoor and outdoor apparel,
home furnishings (i.e., bedding products, curtains, and upholstery fabrics), luggage,
tarpaulins, equipment covers, wall coverings, automotive uses, tents, air-inflated structures,
books, hoses, belts and gaskets, leather imitations, and a variety of industrial uses.
As Table 2-4 indicates, there are a wide variety of products in the coatings industry.
It is also important to note that many products are produced with a variety of techniques. For
instance, food containers are produced with rubber, polyurethane, and PVC coatings.
2-15
-------
Table 2-3. Variables Essential for Product Development Derived from Applications of
Coated and Finished Materials
Tensile Strength
Food Contact
Elasticity
Abrasion resistance
Tear resistance
Dimensional stability
Interlayer adhesion
Surface roughness
Compatibility
Joints formation and properties
Burning behavior
Water permeability
Solvent vapor permeability
Light transparency
Product appeal
Effect of chemicals
Microbiological protection
Biological corrosion
Aging properties
Service duration
Weight
Odor
Effect of temperature
Thermal properties
Antistatic properties
Air tightness
Sunlight reflection
Colorfastness
Cleaning frequency
Source: Wypych, J. 1988. Polymer Modified Textile Materials. New York: John Wiley & Sons.
Similarly, clothing products are made with all three types of coatings. Although various
coatings can provide the same function, many specialized products are only made with
specific coating materials, such as arctic fuel drums and fabrics used to control erosion
(Wypych, 1988).
The wide variety of uses and applications for both coated and finished fabrics
translates into an equally wide variety of industries and consumers that use them.
Automotive, apparel, furniture, home furnishing, wallcovering, book, tent, road building, and
many other industries all make extensive use of coated and finished fabrics. Table 2-5
presents the markets that demand coated fabrics. In a 1993 report on the industry, the U.S.
International Trade Commission (USITC) gives another account of industries that use coated
and finished fabrics. These industries and the factors that influence their demand are shown
in Table 2-6. These industries range from the military and aerospace industries to apparel
and home furnishings. The automotive sector is the largest consumer of coated and finished
2-16
-------
Table 2-4. Coated Fabric Products and the Materials Used to Make Them
Produced Produced with Produced Produced Produced
with PVC Polyurethane with Rubber with Acrylic with Teflon
Coated Coated Coated Coated Coated
Coated Fabric Product Materials Materials Materials Materials Materials
Air inflated structures /
Aprons /
Arctic fuel drums S
Asphalt construction /
Automotive upholstery / /
Awnings S
Boat covers / /
Boats / /
Chimney covers S
Clothing S S S
Collapsible containers /'/'/'
Collapsible fuel tanks /
Conveyor belts / / /
Devices to reduce escape /
of vapors
Earth stabilization /
Erosion control S
Factory curtains /
Flexible space dividers /
Food containers / / /
Footwear / / /
Fuel hoses / /
Garbage chutes /
Gaskets /
Greenhouses
Gymnasium mats /
Home furnishings S S
Inflatable boats / /
Large buildings and /
structures
Life jackets /
Luggage / /
Membranes S
Mining S
Oil ring shelters /
(continued)
2-17
-------
Table 2-4. Coated Fabric Products and the Materials Used to Make Them (continued)
Produced
Produced with Produced Produced Produced
with PVC Polyurethane with Rubber with Acrylic with Teflon
Coated Coated Coated Coated Coated
Coated Fabric Product Materials Materials Materials Materials Materials
Pool covers /
Pool liners S
Rainwear S S S
Road building /
Roof sealants /
Silos /
Sliding roofs /
Sportswear /'/'/'
Storage bags / /
Swimming pools /
Tarpaulins /'/'/'
Tents / / /
Truck covers / /
Ventilation ducts /
Ventilation tubing /
Warehouses /
Source: Wypych, J. 1988. Polymer Modified Textile Materials. New York: John Wiley & Sons.
fabrics, (USITC, 1993). For each industry, specific factors influence their demand for
products. However, in general, demand closely follows changes in general economic activity
(USITC, 1993).
2.2.3 Substitutes
The presence of substitutes is important because they are a critical determinant of
demand elasticity. Demand will be far more elastic for goods that have readily available
substitutes with comparable price and performance qualities. The principal substitutes for
coated fabrics are uncoated fabrics and leather, rubber, or plastic products that do not have a
fabric substrate. For example, uncoated canvas fabric is sometimes used for tents. Also,
plastic sheets can be used as tarpaulins or rain ponchos. Imitation leather products are
typically made with polyurethane-coated fabrics. Consequently, authentic leather products
2-18
-------
Table 2-5. Coated Fabric Demand by Product Market
Market Percent of Demand
Motor vehicles 26%
Furniture 19%
Industrial 10%
Wallcoverings 9%
Protective clothing 9%
Books 6%
Awnings 5%
Nonauto transportation 5%
Tents and other 11%
Source: Freedonia Group. 1999. Coated Fabrics in the United States to 2003—Introduction, Executive
Summary, Market Environment, Coated Shipments, Demand and Markets. Available at
.
are substitutes for the imitations. Coated fabrics tend to perform better than fabrics that are
not coated; they can be stronger or more waterproof or exhibit other qualitites presented
earlier in this section that cannot be achieved from an uncoated fabric product. Similarly,
materials that lack a fabric substrate are not as stable and resilient as a coated fabric product.
Consequently, there are not many substitutes for coated fabrics that exhibit comparable
performance characteristics. However, coated fabrics can be substituted for one another,
because various types of fabrics and coatings can be combined to perform similar tasks.
Likewise, various finished fabrics can be substitutes for one or another. However, there are
no apparent substitutes for finished fabrics as a whole.
2.3 Industry Organization
This section provides information to describe firms' behavior within the market for
both fabric coated and finished products. Data for location of coating and finishing facilities
are provided, along with a description of market structure in terms of key estimates of
industry construction.
2-19
-------
Table 2-6. Coated Fabrics: Principal U.S. Industries and Factors Affecting Demand
Industry
Demand Factors
Aerospace
Apparel and footwear
Automotive
Chemicals and oil
Construction and
building
Home furnishings
Luggage
Marine and boating
Medical and health
Military
Recreation and sports
Space programs and developmental projects; military spending on aircraft;
replacement of aircraft or parts by commercial airlines
Styles and fashion; improved characteristics (i.e., breathability and moisture
absorbency)
New products, (i.e., air bags); interior style change (i.e., cloth seats); substitibility
for other materials (i.e., plastics)
Environmental awareness; new EPA regulations; change in storage and shipping
capacity
Expansion of infrastructures; housing starts; repairing of existing civil engineering
projects
Awareness of home energy conservation; home decorating; popularity of leisure
and casual furniture
Economic conditions affecting the travel industry; styles and fashion
Popularity of water-related activities; favorable climatic conditions
Public and institutional awareness of confinement of contagious diseases;
disposable versus reusable products; new medical discoveries and applications
Shortage of required equipment; international armed conflict; change in number of
active-duty and reserve forces
New sports facilities; promotion of physical fitness and individual conditioning;
more individual leisure and recreational time
Source: U.S. International Trade Commission (USITC). 1993. Industry and Trade Summary: Coated
Fabrics. Washington, DC: U.S. International Trade Commission.
2.3.1 Market Structure
Market structure is of interest because it determines the behavior of producers and
consumers in the industry. In perfectly competitive industries, neither consumers nor
producers can affect the prices of goods. In addition, producers are unable to affect the price
of inputs purchased for use in their products. This condition most likely holds if the industry
has a large number of buyers and sellers, the products sold and inputs used in production are
homogeneous, and there is free entry and exit for firms in the industry. Entry and exit of
firms are unrestricted for most industries, except in cases where one firm holds a patent on a
product, where the government regulates who is able to produce output (like in the utility
2-20
-------
industries), where one firm owns the entire stock of a critical input (as in the diamond
industry), or where a single firm is able to supply the entire market. In industries that are not
perfectly competitive, producer and/or consumer behavior can affect price considerations.
Concentration ratios (CRs) and Herfindahl-Hirschmann indices (HHIs) can provide
some insight into the competitiveness of an industry. The U.S. Department of Commerce
reports these ratios and indices for the six-digit NAICS code level for 1997, which is the
most recent year available. CRs are typically measured in two ways: the CR4 gives the
percentage of sales for the top four companies in an industry, and the CRS is the percentage
of sales for the top eight companies in an industry. Table 2-7 shows the measure of market
concentration for fabric coatings and finishing companies in 1997.
Table 2-7. Measure of Market Concentration for Fabric Coatings and Finishings
Companies: 1997
NAICS
313210
313311
313312
313320
Number of Companies
734
1255
346
246
Value of Shipments
(io3)
18,269
9,295
4,403
2,133
CR4
23.8
28.0
29.7
14.8
CRS
35.4
38.4
41.6
26.2
HHI
252.1
274.8
323.9
160.2
Source: U.S. Census Bureau. 1997. Concentration Ratios in Manufacturing, EC97M31S-CR. Available at
.
The criteria for evaluating the HHIs are based on the 1992 Department of Justice's
Horizontal Merger Guidelines. According to these criteria, industries with HHIs below
1,000 are considered unconcentrated (i.e., more competitive), those with HHIs between
1,000 and 1,800 are considered moderately concentrated (i.e., moderately competitive), and
those with HHIs above 1,800 are considered highly concentrated (i.e., less competitive). In
general, firms in less concentrated industries are more likely to be price takers, while those in
more concentrated industries have more ability to influence market prices. Based on these
criteria, the fabric coating and finishing industry is considered unconcentrated.
2-21
-------
2.3.2 Manufacturing Facilities
EPA has identified 61 facilities that are major sources and produce coated fabrics.
Out of 61 facilities, 52 are identified by ownership, and are owned by 44 ultimate parent
companies. According to publicly available business directories, there are 84 facilities,
owned by 71 parent companies, that are engaged in fabric coating. Because EPA does not
have data to identify the companies owning nine of the major sources, these 71 coating
companies are the focus for Section 2.3.4. Several of the facilities and companies described
are not major sources and will not incur costs.
Table 2-8 shows the location (by state) of the 84 facilities. Most production for the
industry is concentrated in the eastern part of the country. Both Massachusetts and Ohio
have the greatest number of manufacturing facilities (10). South Carolina is second (7),
followed by Connecticut (6), North Carolina (6), and Tennessee (5). There are 19 states
without any facilities that produce coated fabrics. These are mostly concentrated in the
western United States, but Florida, Maine, Oklahoma, Pennsylvania, Vermont, and West
Virginia are also without any facilities.
Besides coating facilities, EPA has identified 74 facilities that are major sources
engaged in finishing fabrics. Of the 74 facilities, 22 are identified by ownership and owned
by 6 ultimate parent companies. However, according to the 1997 Census of Manufactures,
there were approximately 1,784 facilities engaged in finishing fabrics in the U.S. (see Table
2-9). Out of 1,784 facilities, 203 are listed in Ward's Business Directory, owned and
operated by 177 parent companies, and categorized under NAICS 313311 Broadwoven
Fabric Finishing Mills, NAICS 313312 Textile and Fabric Finishing (Except Broadwoven
Fabric) Mills, and part of NAICS 313210, Broadwoven Fabric Mills. The vast majority of
these facilities are not major sources and will not incur costs due to the rule. The majority of
these are located in the eastern United States, particularly in New York (354), North Carolina
(211), New Jersey (128), and South Carolina (98). However, California has the second
greatest number of finishing facilities (224).
2.3.3 Facility Employment and Economies of Size
This section presents employment data based on the statistics from the Census
Bureau because of the lack of facility-specific data. As shown in Table 2-10, only six
coating facilities (2 percent of the total coating facilities) employ more than 250 workers, and
250 finishing facilities employ more than 250 workers (about 10 percent of the total finishing
2-22
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Table 2-8. Textile Coating Facility Locations
State
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
Georgia
Idaho
Illinois
Indiana
Kansas
Kentucky
Maryland
Massachusetts
Michigan
Minnesota
Number of Facilities
2
3
3
2
6
1
1
1
2
2
1
1
1
10
2
1
State
Mississippi
Missouri
Nebraska
New Hampshire
New Jersey
New York
North Carolina
Ohio
Rhode Island
South Carolina
Tennessee
Texas
Virginia
Washington
Wisconsin
Total
Number of Facilities
1
2
1
1
4
1
6
10
2
7
5
2
1
1
1
84
facilities). The smallest employment size category, with between one and nine workers, has
the largest number of operating facilities for both coating (102) and finishing (1,351). These
represent about 40 percent of the 258 facilities that make up the 313320 NAICS category and
51 percent of the 2,629 facilities in NAICS codes 313311, 313312, and 313210. The next
largest employment size category has between 10 and 49 workers. There are 90 coating
facilities in this grouping (approximately 35 percent of the total coaters) and 587 finishing
facilities (22 percent of the total finishers). It should be noted that these figures are for the
facility level, not the company level. Company-specific employment data are presented in
Section 2.3.4.
Different types of production may be most efficiently performed in certain sizes of
facilities. Economies of size refer to production processes that are more efficiently
performed, the larger the size of the facility. Table 2-9 provides information on the
efficiency of plant size for those facilities in NAICS 313320, 313311, 313312, and 313210 in
2-23
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Table 2-9. Textile Finishing Facility Locations, by State
NAICS Code
Total Establishments
California
Georgia
Massachusetts
Michigan
New Hampshire
New Jersey
New York
North Carolina
Ohio
Pennsylvania
Rhode Island
South Carolina
Tennessee
Texas
Virginia
313311
1,337
173
52
11
90
284
114
22
39
21
75
24
36
313312 3132109 313210P 313210U
383 14 38 12
51
26 5a T
r
r
38
70
75 5a 18a
27
8
17 6a
10
5
5a
Total
1,784
224
85
1
11
1
128
354
211
22
66
29
98
34
41
5
a The number of facilities in a state = Total establishments in the United States x (Value of shipments in a
state / Value of shipments in the United States)
Sources: U.S. Census Bureau. 1999a. Broadwoven Fabric Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999b. Broadwoven Fabric Finishing Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999c. Textile and Fabric Finishing (Except Broadwoven Fabric) Mills. 1997
Economic Census: Manufacturing—Industry Series.
.
2-24
-------
Table 2-10. Facility-Level Employment and Size Economy for Fabric Coating and
Finishing Industry, 1997
Number of Employees
NAICS Code/Industry
Coating Industry
3 13320 Fabric Coating Mills
Number of facilities
Value added by manufacturer ($106)
Number of production worker hours (106)
Value added/production worker hour ($)
Finishing Industry
Number of facilities
Value added by manufacturer ($106)
Number of production worker hours (106)
Value added/production worker hour ($)
313311 Broadwoven Fabric Finishing Mills
Number of facilities
Value added by manufacturer ($106)
Number of production worker hours (106)
Value added/production worker hour ($)
313312 Textile & Fabric Finishing Mills
Number of facilities
Value added by manufacturer ($106)
Number of production worker hours (106)
Value added/production worker hour ($)
313210 Broadwoven Fabric Mills b
Number of facilities
Value added by manufacturer ($106)
Number of production worker hours (106)
Value added/production worker hour ($1
Ito9
102
23
0.5
49.91
1,351
354
8.1
43.96
813
272
5.0
53.90
120
21
0.7
31.13
418
61
2.3
26.21
10 to 49
90
172
3.1
55.72
587
1,062
19.5
54.44
310
619
9.5
65.39
128
268
5.0
53.69
149
175
5.1
34.69
50 to 249
60
542
10.1
53.60
441
3,879
93.6
41.44
172
1,506
33.7
44.63
100
624
18.9
33.05
169
1,749
41.0
42.68
250 to 999
6
138
3.1
44.71
224
5,522
175.2
31.52
36
1,236
25.7
48.17
34
459a
16.5a
27.82a
154
3,827
133.0
28.77
1,000 or more
NA
NA
NA
NA
26
NA
NA
NA
6
409
11.8
34.60
1
NA
NA
NA
19
NA
NA
NA
a Data for employment size 500 to 999 were withheld to avoid disclosing data of individual companies.
b Including all the 909 establishments categorized in NAICS Code 313210 instead of the facilities (categorized
in NAICS 3132109, 313210P, and 313210U) engaged only in fabric finishing .
NA = Not available
Sources: U.S. Census Bureau. 1999a. Broadwoven Fabric Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999b. Broadwoven Fabric Finishing Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
U.S. Census Bureau. 1999c. Textile and Fabric Finishing (Except Broadwoven Fabric) Mills. 1997
Economic Census: Manufacturing—Industry Series.
.
U.S. Census Bureau. 1999d. Fabric Coating Mills. 1997 Economic Census:
Manufacturing—Industry Series, .
2-25
-------
1997. Using the value added per production worker hour as a measure of plant efficiency,
the fabric coating and finishing industry shows no apparent size economies. For most of the
NAICS codes, relatively small facilities (10 to 49 workers) appear to be the most efficient,
because they demonstrate the highest value added per worker hour.
2.3.4 Companies
Potentially directly affected companies include entities that own manufacturing plants
that perform fabric coating or printing operations or fabric slashing, dyeing, or finishing
operations. The chain of ownership may be as simple as one plant owned by one company or
as complex as multiple plants owned by subsidiary companies. Based on survey and
secondary source data, EPA identified 71 ultimate parent companies that may own and
operate the 61 directly affected fabric coatings facilities. For the economic analysis, EPA
obtained company sales and employment data from survey data or from one of the following
secondary sources:
• Dun & Bradstreet Market Identifiers (Lycos Companies Online, 2001),
• Hoover's Company Profiles (Hoover's Online, 2001), and
• ReferenceUSA Business Database Version 4.1 (ReferenceUSA, 2001).
Out of the 71 companies, sales and employment data were available for 68 and 69
companies, respectively, which are shown in Table 2-11. As for the fabric finishing
facilities, the sales and employment data are not discussed here because most of the company
identities are unavailable to EPA.
2.3.4.1 Small Business Identification
The Regulatory Flexibility Act (RFA) of 1980, as amended by the Small Business
Regulatory Enforcement Fairness Act (SBREFA) of 1996, requires EPA to give special
consideration to small entities affected by federal regulation. Companies operating fabric
coatings manufacturing plants can be grouped into small and large categories using Small
Business Administration (SBA) general industry size standard definitions. The SBA defines
small businesses in terms of the sales or employment of the owning entity, and these
thresholds vary by the industry classification (NAICS code). Businesses within the NAICS
313210, 313311, and 313320 industry categories that have 1,000 or fewer employees are
considered small by the SBA, and for NAICS 313312 those with 500 and fewer employees
2-26
-------
Table 2-11. Parent Companies
Parent Company Name
Alpha Associates Inc.
Amerbelle Corporation
American Industrial Partners Capital Fund II LP
American Roller Company
ATHOL Corporation
Avery Dennison Corporation
Avon Tape Inc.
Avondale Inc./Avondale Mills
Bando Mfg. of America, Inc.
Bradford Industries, Inc.
Brownell & Company, Inc.
Carolina Rubber Rolls
Coats PLC
Cooper Tire & Rubber Company, Inc.
Cortland Line Company, Inc.
Cytec Industries, Inc.
Dana Corporation
Delatex Processing Corporation
Dimension Polyant Sailcloth, Inc.
Duraco, Inc.
Duro Industries, Inc.
Eddington Thread Mfg. Company
Excello Fabric Finishers, Inc.
Fil-Tec, Inc.
GenCorporation, Inc.
General Clothing Company, Inc.
Globe Rubber Works, Inc.
Goodrich Corporation
Goodyear Tire & Rubber Company
Groupe Zodiac
Guardian Mfg. Company
H.C. Chandler & Son, Inc.
Sales
($106)
35
26
247
47
3,700
2
880
14
53
8
35
2,383
2,100
15
1,493
12,460
1
8
28
199
5
4
14
1,047
8
35
4,364
14,417
1,154
8
Employment
Number
105
300
2,650
230
17,400
35
7,300
153
177
35
75
49,946
21,586
110
4,800
79,300
8
35
151
800
100
15
83
7,895
35
75
22,136
105,128
9,615
35
Year
2000
2000
2001
2000
2001
2001
2001
2000
2000
2001
2001
2000
2001
2001
2000
2000
2000
2000
2000
2000
2000
2000
2000
2000
2001
2001
2000
2000
2000
2001
Source
InfoTrac
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
ReferenceUSA
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
ReferenceUSA
ReferenceUSA
Hoover's Online
Dun & Bradstreet
Dun & Bradstreet
Hoover's Online
Hoover's Online
InfoUSA
InfoUSA
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
InfoUSA
Dun & Bradstreet
Hoover's Online
ReferenceUSA
ReferenceUSA
Hoover's Online
Hoover's Online
Hoover's Online
ReferenceUSA
(continued)
2-27
-------
Table 2-11. Parent Companies (Continued)
Parent Company Name
Haartz Coporation
Habasit
Hallwood Group, Inc.
Hbd Ind., Inc.
Hexcel Corporation.
Holliston Mills, Inc.
Hub Fabric Leather Company, Inc.
Imco, Inc.
Invensys PLC
J. Charles Saunders Company, Inc.
Koch Enterprises, Inc.
Lord Corporation
Mark IV Industries, Inc.
Meridian Industries, Inc.
Norcross Safety Products LLC
Ouimet Corporation
Par Products
Parker Hannifin Corporation
Penn Racquet Sports
Phoenix Medical Techs., Inc.
Plymouth Rubber Company, Inc.
Polycraft
Rapid Die & Molding Company, Inc.
RBX Corporation
Reeves Brothers, Inc.
Robin Ind., Inc.
Ruddick Corporation
Schneller, Inc.
Seaman Corporation
Star-Glo Ind., Inc.
Takata, Inc.
Sales
($106)
100
213
115
100
1,056
21
5
15
14,380
15
284
500
270
250
15
2
5,300
75
13
74
4
4
263
300
15
2,683
28
22
14
375
Employment
Number
350
1,850
807
1,350
6,072
184
35
175
121,683
75
3,500
3,000
17,000
1,200
2,600
65
15
42,728
390
300
480
15
8
2,300
3,000
75
20,000
200
290
180
6,000
Year
2000
2000
2000
2000
2000
2000
2000
2001
2000
2001
2001
2001
2001
2000
2001
2000
2001
2000
2000
2001
2000
2001
2000
2001
2000
2000
2000
2001
2000
Source
Dun & Bradstreet
InfoTrac
InfoTrac
InfoTrac
Hoover's Online
Dun & Bradstreet
Dun & Bradstreet
ReferenceUSA
Hoover's Online
ReferenceUSA
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
InfoUSA
ReferenceUSA
Dun & Bradstreet
InfoUSA
Dun & Bradstreet
Hoover's Online
ReferenceUSA
InfoUSA
Dun & Bradstreet
InfoUSA
ReferenceUSA
Hoover's Online
Dun & Bradstreet
Dun & Bradstreet
Dun & Bradstreet
InfoTrac
(continued)
2-28
-------
Table 2-11. Parent Companies (Continued)
Parent Company Name
Tennessee Mat Company
Textile Tapes Coporation
Canadian General Tower, Ltd.
Tomkins PLC
Toray Industries, Inc.
Uniroyal Technology Corporation
Uretek, Inc.
Warco Holdings, Inc.
Sales
($106)
13
2
300
5,908
8,513
201
13
35
Employment
Number
175
35
1,100
52,755
35,686
1,233
70
450
Year
2001
2001
2001
2001
2001
2001/20
00
2000
2001
Source
Dun & Bradstreet
ReferenceUSA
Dun & Bradstreet
Hoover's Online
Hoover's Online
Dun & Bradstreet/
Hoover's Online
Dun & Bradstreet
Dun & Bradstreet
Sources: Lycos Companies Online. 2001. Dun & Bradstreet Market Identifiers.
Hoover's Online. 2001. Companies and Industry. Available at .
InfoUSA.
ReferenceUSA. 2001. ReferenceUSA Business Database Version 4.1.
are considered small (U.S. SB A, 2001). However, only the small businesses in NAICS
313320 are investigated further in this section due to the lack of information on companies
owning of finishing facilities.
As mentioned above, EPA identified 71 parent companies that may own and operate
the directly affected fabric coating facilities. Forty-one percent of the companies identified
by EPA as owners of affected facilities employ more than 1,000 workers. Using the SB A
definition of a small business, 59 percent of the companies identified fall in the small
business category, including companies without employment data. Table 2-12 shows the
large number of small businesses in this industry that employ a small number of workers.
The employment size category with 0 to 49 employees and 100 to 249 employees per
company had the largest number of companies with 12 (29 percent of the total).
Table 2-13 shows a frequency distribution of small companies in the industry by
sales. As with employment data, sales data were not available for 2 of the 42 identified
companies. Companies with less than $10 million in annual sales made up 31 percent of the
identified firms. Fifty percent of the companies had sales from $10 to $49 million. Fourteen
2-29
-------
Table 2-12. Employment Size Distribution of Small Companies
Employment Range
Oto49
50 to 99
100 to 249
250 to 499
500 to 999
NA
Total Companies
Number of Companies
12
7
12
7
2
2
42
Percent
29%
17%
29%
17%
5%
5%
100%
Sources: Hoover's Online. 2001. Companies and Industry. Available at .
Lycos Companies Online. 2001. Dun & Bradstreet. Market Identifiers.
Hoover's Online. 2001. Companies and Industry. Available at .
ReferenceUSA. 2001. ReferenceUSA Business Database Version 4.1.
percent of companies had $50 million or more in sales. Once again, the number of small
companies is most likely an underestimate, because it does not include the companies for
which data are not available (these companies are most likely small).
The large number of small firms in the industry is in part the result of significant
structural change in recent years. The fabric coatings industry has seen the entry of many
small, highly specialized firms. Between 1987 and 1992, the industry realized a net gain of
almost 30 firms (USITC, 1993). Most of these new firms are believed to be very small
manufacturers of high performance textiles with special properties for specific end-use
applications. The trend towards specialization has occurred because these products often
have very specific capital equipment requirements for their production (USITC, 1993).
2.4 Markets
This section examines market volumes and prices only for the fabric coating industry.
Market information for finishing industry is not discussed in detail because fabric finishers
are categorized as part of several NAICS codes, all data from the Census Bureau have been
aggregated at the industry level based on NAICS codes, and detailed market data are not
available from the Freedonia Group. The rest of this section starts by examining trends in
product shipments for the fabric coating industry. This discussion is followed by a
presentation of market price data. Next is a brief analysis of the industry's future outlook.
Finally, foreign trade issues are examined, along with export and import data.
2-30
-------
Table 2-13. Sales Size Distribution of Small Companies
Sales Range ($106)
Oto4
5 to 9
10 to 24
25 to 49
50 to 99
100 to 499
NA
Total
Number of Companies
7
6
13
8
3
3
2
42
Percent of Total
17%
14%
31%
19%
7%
7%
5%
100%
Sources: Hoover's Online. 2001. Companies and Industry. Available at .
Lycos Companies Online. 2001. Dun & Bradstreet. Market Identifiers.
Hoover's Online. 2001. Companies and Industry. Available at .
ReferenceUSA. 2001. ReferenceUSA Business Database Version 4.1.
2.4.1 Value of Shipments
Table 2-14 shows the trends in employment and shipments for the industry from 1985
through 1998. It is clear from these data that, although shipments have expanded over this
time, employment has not increased significantly. For NAICS 313320 (SIC 2295), value of
shipments increased approximately 55 percent from 1985 to 1996 (U.S. Census Bureau,
2000a). Conversely, employment increased at only 1 percent over the same period. Thus,
increased production can be explained by increased productivity per worker or higher capital
to labor ratios rather than by the addition of more workers. The decline in the average
number of production workers in the industry is the result of an increased emphasis on
capital investments and the greater efficiency of machinery (USITC, 1993).
The value of shipments by product type has been fairly stable over the past decade.
Table 2-15 presents data from a Freedonia Group report from August 1999. It shows that the
proportion of total shipments that accounted for nonrubber-coated fabrics was 71 percent in
1989, 71 percent in 1993, and 72 percent in 1998. The report predicts that these numbers
will jump to 74 percent and 76 percent, respectively, in 2003 and 2008. Rubber-coated
2-31
-------
Table 2-14. General Trends: 1985-1998
Year3
SIC 2295
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
NAICS 313320°
1997
1998
Value of
Shipments
($106)
$1,228.2
$1,172.0
$1,433.7
$1,509.4
$1,542.7
$1,361.8
$1,298.4
$1,528.1
$1,773.3
$1,804.3
$1,827.9
$1,906.1
$2,256.7
$2,304.2
Employment
10,400
9,700
10,300
10,300
9,400
8,900
8,000
9,200
9,900
10,800
11,100
10,500
11,592
11,441
Value of
Shipments/Employee
($106)
$0.1181
$0.1208
$0.1392
$0.1465
$0.1641
$0.1530
$0.1623
$0.1661
$0.1791
$0.1671
$0.1647
$0.1815
$0.1947
$0.2014
New Capital
Expenditures'"
($106)
$33.9
$37.4
$63.4
$38.7
$59.8
$52.9
$54.5
$47.1
$55.8
$75.2
$74.8
$89.8
$74.39
$47.686
a Data from 1993-1996 were taken from U.S. census Annual Surveys of Manufactures for those years. Data
from 1985-1992 were taken from 1992 U.S. census data. Data from 1997-1998 were taken from U.S.
Census Annual Survey of Manufactures for NAICS 313320 for 1997-1998.
b The 1997-1998 survey of manufactures refers to capital expenditures as "total capital expenditures," rather
than "new capital expenditures," which was the term used for data from previous years.
c Data for 1997-1998 are for NAICS code 313320, which includes "rubber coated fabrics." These products
were not previously classified under the SIC code 2295. In 1998, "rubber coated fabrics" accounted for 9.5
percent of the value of product shipments for coated fabrics included in the NAICS 313320 product class.
Source: U.S. Census Bureau. 2000a. Annual Survey of Manufactures—Industry Statistics.
.
2-32
-------
Table 2-15. Coated Fabrics Shipments by Type: 1989-2008 ($106)
Product
United States GDP ($109)
$ Fabric/million $ GDP
Nonrubber-coated fabrics
Rubber-coated fabrics
Fabric-backed wallcoverings
Total coated fabric shipments
1989
5,439
374
1,459
351
226
2,036
1993
6,558
342
1,585
431
226
2,242
1998
8,511
331
2,052
484
285
2,821
2003
1,075
319
2,555
550
310
3,415
2008
13,550
304
3,150
630
340
4,120
Source: Freedonia Group. 1999. Coated Fabrics in the United States to 2003—Introduction, Executive
Summary, Market Environment, Coated Shipments, Demand and Markets. Available at
.
fabrics made up 17 percent of total shipments in 1989, 19 percent in 1993, and 17 percent in
1998 and are predicted to be 16 percent in 2003 and 15 percent in 2008. Finally, fabric-
backed wallcoverings accounted for 11 percent of total shipments in 1989. The proportion is
predicted to be 9 percent in 2003 and 8 percent in 2008 (Freedonia, 1999).
2.4.2 Market Prices
Price data for the fabric coatings industry are presented in Table 2-16. The table
shows that prices in dollars per square yard of coated fabric were $4.72 in 1998, according to
a Freedonia Group report from August 1999. Prices for coated fabrics fell roughly 10
percent between 1989 and 1998. The report predicts a similar decline through 2008.
Because of the wide range and variability of coated fabric products, the price per yard also
varies widely, and specialized, highly technical products are more costly. Disaggregated
price data were not available.
2.4.3 Future Outlook
Shipments of coated fabrics are forecasted to increase 3.9 percent annually until 2003
(Freedonia Group, 1999). This represents a decline in growth from the mid-1990s, when
demand was high due to a rebound from the recession of the early 1990s. The Freedonia
Group (1999) forecasts that average prices for coated fabrics will continue to decrease
through 2008.
2-33
-------
Table 2-16. Coated Fabrics Pricing Trends: 1989-2008 ($106)
Year
Coated fabrics demand
(million sq. yards)
$/sq. yard
Coated fabrics demand
($106)
1989
355
5.22
1,854
1993
401
5.17
2,072
1998
525
4.72
2,480
2003
635
4.54
2,880
2008
770
4.39
3,380
Source: Freedonia Group. 1999. Coated Fabrics in the United States to 2003—Introduction, Executive
Summary, Market Environment, Coated Shipments, Demand and Markets. Available at
.
Parts of the industry are expected to expand. The increased use of airbags with the
addition of side-impact airbags, under-dash airbags, and expanded use of airbags in trucks
will create an increase in demand for coated nylon. Industry segments of nonautomotive
transport equipment (boat and truck covers), protective clothing, awnings, and canopies are
also expected to have increased demand. Table 2-17 shows the demand over time from 1989
through 2008 by market sector. It shows that for all sectors except industrial uses, the
growth in demand from 1998 through 2008 is expected to decline from the levels
experienced by the industry from 1989 through 1998.
2.4.4 International Trade
When compared to the textile industry in general, the fabric coatings industry has
fared relatively well in the face of increased foreign competition. Unlike the broader textile
goods industry, the coated fabrics industry had not seen a significant decline in employment
during the 1990s (Heil and Peck, 1998). It is clear that trade activity overall has increased
because of the industry's increasingly global nature (Smith, 1999). Import and export sales
totals rose 30 percent from 1989 to 1998. However, despite the growth of the industry
abroad and an increase in imports, exports have also increased. Actually, the trade surplus
for coated fabrics in the United States doubled from $170 million in 1993 to $341 million in
1998. This growth came after a 7 percent decline in net exports from 1989 to 1993. The
increase in net exports is expected to continue through 2008. Net exports are forecast to be
$535 million in 2003 and $740 million in 2008 (Freedonia, 1999). Table 2-18 shows data
from the 1999 Freedonia Group report.
2-34
-------
Table 2-17. Coated Fabrics Demand (million sq. yards)
Coated Fabrics Demand
Coated fabrics demand
Motor vehicles
Furniture
Industrial
Protective clothing
Wall coverings
Book coverings
Awnings and canopies
Nonautomotive
transportation equipment
Commercial tents
Other markets
1989
355
79
74
46
28
37
27
14
12
11
27
1993
401
96
79
49
34
38
30
15
15
13
32
1998
525
137
101
53
47
45
32
27
25
18
40
2003
635
182
115
61
56
47
34
33
36
21
50
Percent Annual Growth
2008 1989-1998 1998-2008
770
236
135
68
65
51
36
40
53
25
61
4.4
6.3
3.5
1.6
5.9
2.2
1.9
7.6
8.5
5.6
4.5
3.9
5.6
2.9
2.5
3.3
1.3
1.2
4
7.6
3.3
4.3
Source: Freedonia Group. 1999. Coated Fabrics in the United States to 2003—Introduction, Executive
Summary, Market Environment, Coated Shipments, Demand and Markets. Available at
.
Although U.S. producers have been able to dominate the domestic market for high
priced items, imports of lower priced items have increased dramatically. U.S. imports of
coated fabrics rose by 33 percent from 1988 to 1992 (USITC, 1993). Imported products are
usually lower priced items, such as imitation leather and other consumer goods where small
variations in quality are not critical. Canada was the largest supplier of imports from 1988 to
1992, supplying 28 percent of imports by value. Others foreign suppliers were Germany,
Taiwan, Italy, and Japan, which collectively supplied 39 percent of the value of imported
products (USITC, 1993).
Larger manufacturers supply the greatest proportion of U.S. exports (USITC, 1993).
These products tend to be high quality, high priced, industrial-use products with specific
applications. U.S. producers have a reputation of producing high quality products with high
levels of consistency. The United States is increasingly less competitive in markets for lower
priced consumer goods. The largest export markets for U.S.-produced coated fabrics were
Canada, Japan, and Europe from 1988 to 1992. However, in developing countries, the
2-35
-------
Table 2-18. Coated Fabrics Foreign Trade: 1989-2008 ($106)
Shipments
Exports
Imports
Net exports
Sales
Imports as percentage of sales
Exports as percentage of shipments
1989
2,036
480
298
182
1,854
16.1
23.6
1993
2,242
400
230
170
2,072
11.1
17.8
1998
2,821
677
336
341
2,480
13.5
24
2003
3,415
985
450
535
2,880
15.6
28.8
2008
4,120
1270
530
740
3,380
15.7
30.8
Source: Freedonia Group. 1999. Coated Fabrics in the United States to 2003—Introduction, Executive
Summary, Market Environment, Coated Shipments, Demand and Markets. Available at
.
market for fabrics that prevent water pollution and contamination is expected to expand
considerably (USITC, 1993).
The increase in production of coated fabrics abroad is important when considered
within the context of an increasingly strict regulatory environment in the United States.
Environmental issues can be expected to have more of an impact on where goods are
produced than will the economics of production because compliance costs are becoming a
major portion of production costs (Smith, 1999). Unless foreign producers are also facing an
increase in regulatory costs, a well-developed foreign industry is likely to become even more
competitive with the coated fabrics industry in the United States.
Pressure from foreign producers during the 1990s affected not only coated fabrics,
but most sectors of the textile industry. Public comment on the proposed rule noted that
increasing imports would make it difficult for domestic manufacturers to pass increased costs
along to their customers in the form of higher prices.
2-36
-------
SECTION 3
REGULATORY CONTROL COSTS
EPA identified 135 manufacturing plants in the United States that perform fabric
coating, dyeing, printing, slashing, or finishing operations, and are major sources subject to
the textile coating, printing, slashing, dyeing and finishing NESHAP. Of these 135 facilities,
61 are in the textile coating and printing subcategory, and 74 are in the textile slashing,
dyeing, and finishing subcategory. Based on data obtained from industry and supplemented
by publicly available information and contacts with potentially affected facilities, EPA
estimated costs to comply with the NESHAP.
3.1 National Control Cost Estimates
EPA examined non-confidential data provided by the industry in the Textile Coating
and Printing database (ATMI, 1999), and supplemented the data with information drawn
from EPA's environmental databases such as the Toxics Release Inventory. EPA used these
data to identify major sources in the textile coating, printing, slashing, dyeing, and finishing
industry, characterize their current compliance activities, and estimate the incremental
compliance activities and costs they would incur as a result of the rule.
3.1.1 Compliance Costs for the Textile Printing and Coating Subcategory
Based on these data, EPA identified 61 textile coating and printing facilities believed
to be major sources subject to the rule. EPA developed several model plants for this
subcategory, and estimated the incremental costs associated with various types of
compliance activities, including installation of compliance capital equipment, operating and
maintaining the equipment, and monitoring, recordkeeping, and reporting requirements. The
costs for the fabric coating model plants are shown in Table 3-1. Additional details about
how these costs were estimated are available in RTFs January 8, 2002, memorandum to
EPA, entitled "Fabric Coating, Printing and Dyeing Nationwide Compliance Costs." (York
and Peters, 2002).
3-1
-------
Table 3-1. Summary of Textile Coating and Printing Subcategory Model and
Nationwide Control Costsa
Model
Total
„ , , Capital
Number 01 T .
Investment
Model Plants" ($)
New Add-on Control Device*1
Model 1, carbon adsorber
Model 1, catalytic oxidizer
Model 2, thermal oxidizer
Model 3, carbon adsorber
Upgrade of Add-on Control Device
Model 2, catalytic oxidizer
Model 3, catalytic oxidizer
Model 3, carbon adsorber
Model 4, catalytic oxidizer
Model 4, carbon adsorber
New Coating Room (PTE)
Small
Medium
Large
Total Control Costs for Model Plants
2
1
2
4
1
2
o
J
2
1
14
13
29
104,183
300,140
576,551
501,693
130,967
136,036
159,504
182,319
218,447
42,720
50,670
57,120
Nationwide
Total
Capital
Investment
($)
208,366
300,140
1,153,102
2,006,772
130,967
272,072
478,512
364,638
218,447
640,800
658,710
1,656,480
8,089,006
Nationwide
Model Total Total
Annual Cost0 Annual
($/yr) Cost ($/yr)
31,068
90,888
241,585
87,350
36,302
47,914
30,492
58,646
42,523
19,743
22,186
23,569
62,136
90,888
483,170
349,400
36,302
95,828
91,476
117,292
42,523
276,402
288,418
683,501
2,617,336
Except Methylene Chloride Model Plants
Nationwide Total Control Costs Except
Methylene Chloride Control Costs"
16,663,352
5,391,712
New Add-on Control System for Methylene
Chloride Emissions*
Model 1, carbon adsorber
Model 3, carbon adsorber
210,568
700,731
210,568
700,731
62,477
161,218
62,477
161,218
Total Methylene Chloride Control Costs
Nationwide Total Control Costs with
Methvlene Chloride Control Costs8
911,299
17,574,651
223,695
5,615,407
3-2
-------
Table 3-1 Footnotes
The nationwide costs were calculated using model plants to estimate the costs of bringing each of the 16 MACT database facilities and
20 fabric coating facilities owned by small businesses (3 of which are also in the MACT database) into compliance with the emission
limits, extrapolating this to a nationwide cost based on organic HAP emissions for the subcategory, and adding costs for controlling
methylene chloride emissions from the 2 major facilities reporting methylene chloride emissions in the TRI database (neither of which
is in the MACT database or is owned by a small business). For each of the 33 MACT database and facilities owned by small businesses
(8 of which comply with one of the emission limits), the most cost effective add-on control measure (e.g., upgrading capture efficiency
by adding PTE to application stations, or if no add-on controls are in place, the installation of a complete system including PTE and
add-on control device) was costed to bring the facility into compliance with one of the emission limits. The model plant costs include
costs of installing, upgrading, operating and maintaining add-on control systems. MRR costs are presented in Table 2. All costs are in
1997 $.
Number of model plants assigned to the 16 facilities in the MACT database with sufficient information to calculate the facility OCE and
HAP emission rate and to the 17 additional facilities in the small business database to estimate the compliance cost of achieving the
MACT floor compliance options with add-on controls.
From October 12,2001 memorandum regarding compliance costs for textile coating model plants. Note that the upgrade costs
represent incremental costs above the costs of a baseline unit.
Model plant costs represent the costs of a new add-on control device and auxiliaries, including ductwork, butterfly dampers, fans,
motors, and stacks. Coating room costs are presented separately.
Nationwide total control costs for all facilities in the textile coating and printing industry, except plants with methylene chloride
emissions are based on factoring the total control costs for model plants except methylene chloride model plants by the ratio of HAP
emissions estimated for major HAP emission sources in the coating and printing subcategory (minus methylene chloride emissions) to
the HAP emissions reported by plants for which control costs have been estimated (the ratio is 2.06)
Includes cost of add-on control system and coating room.
Nationwide total control costs for all plants in the textile coating and printing industry are the sum of the nationwide total control costs
except methylene chloride control costs and the total methylene chloride control costs.
3.1.2 Compliance Costs for the Textile Slashing, Dyeing, and Finishing Subcategory
EPA identified 74 facilities in the textile slashing, dyeing, and finishing subcategory
that are believed to be subject to the regulation. For the majority of these facilities, only
enhanced monitoring, recordkeeping, and reporting activities will be required. The cost for
these MRR activities is estimated to be approximately $11,500 per facility. EPA identified
seven plants that will incur compliance costs associated with reformulation of the finish they
apply to textiles to reduce formaldehyde emissions. EPA estimates that the cost of
reformulation will be approximately $0.04 per pound of fabric finished with non-compliant
finishing chemicals. EPA estimated worst-case costs of reformulation by assuming that
facilities' total production of finished fabrics was produced using non-compliant finishing.
Nationwide, EPA estimates that only approximately 13 percent of formaldehyde-based
finishing processes use non-compliant finishes. Discussions with finishing facilities confirm
3-3
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that they have a variety of finishing processes, only a small share of which use non-
compliant finishing chemicals. Thus, the assumption that the total production of finished
fabrics used non-compliant finishing chemicals results in a substantial over-estimate of costs.
However, EPA does not have sufficient data to distinguish, on a facility-specific basis, the
share of finishing operations that use non-compliant finishing chemicals. The costs for these
plants are shown in Table 3-2. As the table shows, the reformulation costs vary widely,
ranging from approximately $28,000 to more than $7.6 million. EPA used these over-
estimated costs to assess worst-case company economic impacts.
Table 3-2. Distribution of Maximum Facility Costs for Finishing Reformulationa
Minimum
Median
Mean
Maximum
Production (106 Ibs/yr)
0.43
98.67
81.06
190.00
Estimated Cost per Facility (106 $/yr)
0.03
3.96
3.25
7.61
Most facilities in the finishing subcategory will not be required to reformulate their finishing materials, and will
incur at most $11,478 for monitoring, recordkeeeping, and reporting.
To estimate the nationwide cost of converting to compliant finishing materials, EPA
assumed that 13 percent of the 1.44 billion pounds of fabric per year (i.e., 186 million
pounds of fabric per year) reported to be finished at major facilities for HAP emissions in
operations with associated formaldehyde emissions would incur the cost of reformulating to
low-formaldehyde compliant finishing materials. Applying the 4 cents incremental cost per
pound of finished fabric to use a compliant resin versus a formaldehyde resin to the
estimated 186 million pounds of fabric currently finished with non-compliant materials
yields a nationwide annual cost of $7.5 million per year. The cost of working with chemical
suppliers to reformulate the finish is accounted for in the estimate of the MRR costs.
3.1.3 Estimated National Costs of the Rule
Table 3-3 shows EPA's estimate of the national costs of the rule, including total
capital costs and total annual costs. Total annual costs include the annualized costs of
purchasing and installing the capital equipment plus the annual costs of operating and
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Table 3-3. Summary of Textile Coating, Printing, Slashing, Dyeing, and Finishing
NESHAP
Nationwide Total
Capital Investment
Nationwide Cost Component ($106)
Coating and printing subcategory control costs 17.6
Dyeing and finishing subcategory
reformulation costs
Source category MRR costs 1 .2
Nationwide total compliance costs 18.8
Nationwide Total
Annual Cost
($106)
5.6
7.5
1.4
14.5
maintaining the equipment and conducting enhanced monitoring, recordkeeping, and
reporting activities. National total annualized costs for the rule total approximately $14.5
million, including $5.6 million of control costs for the coating and printing subcategory, $7.5
million in reformulation costs for the finishing subcategory, and $1.4 million in enhanced
monitoring, recordkeeping, and reporting costs shared across both subcategories.
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SECTION 4
ECONOMIC IMPACT ANALYSIS: METHODS AND RESULTS
The underlying objective of the El A is to evaluate the effect of the regulation on the
welfare of affected stakeholders and society in general. Although the engineering cost
analysis presented in Section 3 does represent an estimate of the resources required to
comply with the rule under baseline economic conditions, the analysis does not account for
the fact that the regulations may cause the economic conditions to change. For instance,
producers may elect to discontinue production rather than comply, thereby reducing market
supply. Moreover, the control costs may be passed along to other parties through various
economic exchanges. The purpose of this section is to develop and apply an analytical
structure for measuring and tracking these effects as they are distributed across the
stakeholders tied together through economic linkages.
4.1 Markets Affected by the NESHAP
The determination of markets potentially affected by the rule requires identifying the
products produced at the affected facilities and linking them to markets where they are
exchanged. One important factor that should be considered when considering market
definition is the extent to which the affected commodities are substitutable. The NAICS
codes help considerably in this task because substitutability is often implicit in the industry
definitions. In addition, economic data inputs for these industries are readily available from
the 1997 Economic Census of Manufacturing. The Agency identified four broad industries
for facilities potentially affected by the rule:
• NAICS 313320 (Fabric Coating Mills)—this industry comprises establishments
primarily engaged in coating, laminating, varnishing, waxing, and rubberizing
textiles and apparel (U.S. Census Bureau, 1999d).
• NAICS 313311 (Broadwoven Fabric Finishing Mills)—this industry comprises
establishments primarily engaged in finishing broadwoven fabrics and
establishments of converters who buy broadwoven fabrics as grey goods (undyed,
unfinished), have them finished on contract, and sell at wholesale. Finishing
operations include bleaching, dyeing, printing (roller, screen, flock, plisse), and
4-1
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other mechanical finishing, such as preshrinking, shrinking, sponging,
calendering, mercerizing, and napping (U.S. Census Bureau, 1999b).
• NAICS 313312 (Textile and Fabric Finishing [except Broadwoven Fabric] Mills)
—this industry comprises establishments primarily engaged in dyeing, bleaching,
printing, and other finishing of textiles, apparel, and fabrics (except broadwoven)
and establishments of converters who buy fabrics (except broadwoven) in the
grey, have them finished on contract, and sell at wholesale. Finishing operations
include bleaching, dyeing, printing (e.g., roller, screen, flock, plisse),
stonewashing, and other mechanical finishing, such as preshrinking, shrinking,
sponging, calendering, mercerizing and napping; as well as cleaning, scouring,
and preparing natural fibers and raw stock (U.S. Census Bureau, 1999c).
• NAICS 313210 (Broadwoven Fabric Mills)—this industry comprises
establishments primarily engaged in weaving broadwoven fabrics and felts
(except tire fabrics and rugs). Establishments in this industry may weave only;
weave and finish; or weave, finish, and further fabricate fabric products (U.S.
Census Bureau, 1999a). However, only part of this industry is selected for
economic impact analysis.
Although fabric finishing may take place in specialized shops represented in NAICS
313311 and 313312, fabric finishing also occurs in NAICS 313210 as one of the final steps
in the overall fabric manufacturing process. Thus, the profile includes data from all three
NAICS.
The economic impacts of the rule on the identified industries and related product
markets are examined in the following sections using both a conceptual approach and
operational model. The conceptual approach is described in detail in Section 4.2, followed
by Section 4.3, which presents the economic impact results based on the operational model.
4.2 Conceptual Approach
The Agency developed two national competitive market models to estimate the
economic impacts on society resulting from the regulation. We assume that the commodities
of interest are homogeneous (e.g., perfectly substitutable) and that the number of buyers and
sellers is large enough that no individual buyer or seller has market power (i.e., influence on
market prices). As a result of these conditions, producers and consumers take the market
price as a given when making their production and consumption choices.
4-2
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4.2.1 Supply
After critical review, the Agency determined that survey and compliance cost data
support a limited characterization of supply using two aggregate groups: domestic and
foreign (imports) within each market. These supply segments have some fixed factors of
production (e.g., plant and equipment) that are augmented with variable factors inputs (e.g.,
materials, labor) to produce coated and finished fabrics. These fixed factors are the source of
diminishing marginal returns, hence, increasing marginal costs. Therefore each supply
segment can be characterized by an up ward-sloping supply curve.
An important measure of the magnitude of this response is the price elasticity of
supply, computed as the percentage change in quantity supplied divided by the percentage
change in price. EPA identified one estimate of domestic supply elasticity used in a textile
model (Warfield et al, 2001). The value is approximately 0.4, which means a 1 percent
increase in price would only lead to a 0.4 percent increase in quantity supplied. Because
research indicates that import supply may be more responsive than domestic, EPA assumed a
value of 0.8 for the import supply elasticity in the market for coated fabric.
Comment on the rule emphasized the pressure that foreign producers have put on
domestic textile manufacturers throughout the 1990s. As a result, the commenters doubt that
any increase in domestic prices of textiles, including finished textiles, is possible as a result
of the rule. In response to these comments, EPA has elected to model the market for finished
fabrics and textiles (NAICS 31331) using the assumption that increased imports will
compensate for any reduction in domestic production. As a result, no change in market price
or quantity occurs in that market in response to the rule, only a change in market shares.
4.2.2 Demand
Consumption choices are a function of the price of the commodity, income, prices of
related goods, tastes, and expectations about the future. In this analysis, EPA considered
how these choices change in response to higher prices resulting from regulation, holding
other variables constant. The economic model includes both domestic and foreign demand
and assumes that the law of demand holds (i.e., the quantity demanded for a good falls when
price rises).
EPA identified several estimates of domestic demand elasticity used in textile
models, ranging from approximately -0.4 to -0.9. EPA selected a domestic elasticity of
demand value of approximately -0.8, which means a 1 percent increase in price would lead
to a 0.8 percent decline in quantity demanded, because the model generating that estimate
4-3
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also has a consistently estimated domestic elasticity of supply, which EPA also used in the
model. In contrast, literature estimates for export demand indicate foreign consumers are
more responsive to changes in the market price. EPA's model uses a value of-1.5 for the
elasticity of export demand.
4.2.3 Baseline and With-Regulation Market Equilibrium
Market responses to the rule are shown in Figures 4-1 (Fabric Coating, NAICS
31332) and 4-2 (Fabric and Textile Finishing, NAICS 31331). A graphical representation of
the competitive model of price formation, as shown in Figure 4-1 (a), posits that market
prices and quantities are determined by the intersection of the market supply and demand
curves. Under the baseline scenario, a market price and quantity (p,Q) are determined by the
downward-sloping market demand curve (D) and the up ward-sloping market supply curve
(S) that reflects the sum of the domestic and import supply curves. EPA's model includes
domestic (affected) supply and foreign (unaffected) supply. While there are also unaffected
domestic producers, EPA did not have sufficient data to subdivide domestic production into
affected and unaffected domestic supply. Thus, EPA grouped all domestic supply into a
single segment, and assumed the costs were borne by all domestic suppliers. In fact, the
impacts of the regulation will be concentrated on the affected major sources in each
subcategory.
With the regulation, the costs of production increase for domestic suppliers. The
imposition of these regulatory control costs is represented as an upward shift in the supply
curve for domestic supply. As a result of the upward shift in this supply curve, the market
supply curve for coated and finished fabrics products will also shift upward as shown in
Figure 4-l(b) to reflect the increased costs of production for domestic supply.
In baseline without the standards, the industry produces total output, Q, at price, p,
with domestic producers supplying the amount qa and imports accounting for Q minus qd, or
qu. With the regulation, the market price increases from p to p', and market output (as
determined from the market demand curve, D) declines from Q to Q'. This reduction in
market output is the net result of reductions in domestic supply and increased imports
(foreign supply).
In Figure 4-2, increased imports compensate for any reduction in domestic supply.
Thus, the market supply curve is essentially perfectly elastic in the relevant range. As costs
increase in response to the rule, domestic producers reduce their output. Foreign producers
increase their output in response, so that market price and quantity remain unchanged. The
4-4
-------
+ p
= p
qa
Affected Facilities
Unaffected Facilities
a) Baseline Equilibrium
Market
P'
P
S'
P'
= P
r_::2b
J I
Affected Facilities
Unaffected Facilities
b) With-Regulation Equilibrium
DM
Q
SM/
Q' Q
Market
Figure 4-1. Market Equilibrium without and with Regulation: Printing and Coating
Subcategory
4-5
-------
P/Q
P/Q
P/Q
+ P
= P
Affected Facilities
Q/T qu Q/T
Indirectly Affected
(including international)
a) Baseline Equilibrium
qa Q Q/T
Market
P/Q
P = P'
S'
J I
P/Q
P/Q
+ p'
S'
= P'
Q/T
q'a qa Q/T
Affected Facilities
b) With-Regulation Equilibrium
Indirectly Affected
(including international)
DM
q a Q'= Q Q/T
Market
Figure 4-2. Market Equilibrium without and with Regulation: Slashing, Dyeing, and
Finishing Subcategory
4-6
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with-regulation equilibrium shows that the market share of domestic producers has fallen,
and the market share of foreign producers had increased.
4.2.4 Company-Level Impacts
EPA has detailed facility-level data from the fabric coating and printing MACT
database that permit estimation of a range of possible costs to comply with the regulation.
However, the database does not provide information about the location or ownership of many
of the facilities. Thus, EPA was able to estimate national costs but was not able to identify
which facilities, owned by which companies, would bear which costs. The methodology
outlined above assesses the impacts of the rule on the markets for coated and finished fabrics
and on producers and consumers of those fabrics as a group. It does not, however, address
impacts on individual facilities or companies. To provide some company-specific impact
estimates, EPA compared the range of possible facility-specific costs to sales revenues for
companies owning fabric coating and finishing facilities.
4.3 Economic Impact Results
To develop quantitative estimates of these impacts, we developed a computer model
using the conceptual approach described above.1 Using this model, EPA characterized
supply and demand of two affected commodities for the baseline year, 1997; introduced a
policy "shock" into the model by using control cost-induced shifts in the domestic supply
functions of these markets; and used the market model to determine a new with-regulation
equilibrium in each coated and finished fabrics market. We report the market, industry, and
societal impacts projected by the model below.
4.3.1 Market-Level Impacts
The prices of coated and finished fabrics are expected to increase slightly and
production and consumption decline from 1997 baseline levels. As shown in Table 4-1, the
regulation is projected to increase the prices of coated fabrics by less than 0.1 percent.
Domestic production of coated and finished fabrics is projected to decline, respectively, by
0.08 percent and 0.02 percent.
1 Appendix A includes a description of the model's baseline data set and specification.
4-7
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Table 4-1. Market-Level Impacts: 1997
Change (%)
Fabric Coating Mills (NAICS 31332)
Price 0.06%
Output -0.06%
Domestic -0.08%
Imports 0.04%
Fabric and Textile Finishing Mills (NAICS 31331)
Price 0.00%
Output -0.00%
Domestic -0.02%
Imports 6.48%
4.3.2 Social Cost
The social impact of a regulatory action is traditionally measured by the change in
economic welfare that it generates. The social costs of the rule will be distributed across
producers and their customers. Consumers experience welfare impacts due to changes in
market prices and consumption levels associated with the rule. Producers experience welfare
impacts resulting from changes in profits corresponding with the changes in production
levels and market prices. However, it is important to emphasize that this measure does not
include benefits that occur outside the market, that is, the value of reduced levels of air
pollution with the regulation.
The national compliance cost estimates are often used as an approximation of the
social cost of the rule. The engineering analysis estimated annual costs of $14.5 million in
1997 dollars. In cases where the engineering costs of compliance are used to estimate social
cost, the burden of the regulation is measured as falling solely on the affected producers,
which experience a loss exactly equal to these cost estimates. Thus, the entire loss is a
change in producer surplus with no change (by assumption) in consumer surplus, because no
change in market price and quantity are estimated. This is typically referred to as a "full-cost
absorption" scenario in which all factors of production are assumed to be fixed and firms are
unable to adjust their output levels when faced with additional costs. In response to industry
4-8
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comments that foreign competition makes any price increases for textiles unlikely, EPA is
using this approach in modeling the impacts int the finishing sector.
In contrast, the economic analysis conducted by the Agency in the coating sector
accounts for behavioral responses to the regulation by producers and consumers, as affected
producers shift costs to other economic agents. This approach results in a social cost
estimate that may differ from the engineering compliance cost estimate and also provides
insights on how the regulatory burden is distributed across stakeholders.
As shown in Table 4-2, the economic model estimates the total social cost of the rule
to be $14.5 million. Although society reallocates resources as a result of the increased cost
of production, with-regulation social cost approximates the engineering costs. Consumers
experience a decline in welfare of $1.6 million, because of increased prices and decreased
consumption. All of the loss of consumer welfare is projected in the coating market, because
prices of finished fabrics are unchanged. Domestic producers of coated fabrics are projected
to lose $4.8 million in producers' surplus, and domestic producers of finished fabrics are
estimated to lose $8.5 million in producers' surplus. Foreign producers of coated fabrics are
projected to experience small increases in producers' surplus; foreign producers of finished
fabrics are projected to experience an increase in sales to the U.S., but no increase in their
producers surplus because prices are unchanged.
4.3.3 Estimated Company Impacts
EPA compared estimated costs of complying with the rule to sales revenues for
companies owning fabric coating or finishing facilities. Because EPA was unable to identify
facility-specific costs, EPA's cost-to-sales analysis compares the range of possible facility-
level costs for each subcategory to each owner-company's sales revenues. EPA's database
also had incomplete information about companies owning facilities in the two subcategories.
To identify companies potentially affected by the rule, company data were collected from
Ward's Business Directory for 248 companies, including 64 in the coating NAICS, 165 in
the finishing NAICS codes, and 19 with operations in both coating and finishing NAICS
codes. Table 4-3 presents descriptive statistics for the cost-to-sales ratios for companies
owning fabric coating and/or finishing facilities, based on minimum, median, mean, and
maximum estimated facility costs. There is a substantial range of facility costs in each
subcategory. Because the maximum costs are so high, the mean costs are higher than the
median costs in each subcategory. Clearly, the maximum costs would present a problem for
the finishers, in particular. For the finishing subcategory, EPA recognizes that its facility-
specific costs are clearly overstated. As described in Section 3, the facility-level costs are
4-9
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Table 4-2. Distribution of Social Costs: 1997
Value ($106/yr)
Change in Consumer Surplus -1.59
Fabric Coating Mills -1.59
Domestic -1.24
Foreign -0.35
Fabric and Textile Finishing Mills -0.00
Domestic -0.00
Foreign -0.00
Change in Producer Surplus -12.94
Fabric Coating Mills -4.49
Domestic -4.76
Foreign 0.28
Fabric and Textile Finishing Mills -8.45
Domestic -8.45
Foreign 0.00
Total Social Cost -14.53
overstated because they are estimated assuming the total volume of finished fabric at a
facility is finished with noncompliant materials. In fact, overall only a very small share is
noncompliant (approximately 13 percent). Thus, EPA believes that the best representation of
the impacts a typical company in the industry would face is the median cost-to-sales ratio.
For the coating subcategory, the median cost-to-sales ratio is less than 3 percent for
60 of the 64 companies. For only one company in the coating subcategory do median
estimated costs represent 3 percent or more of the company's baseline revenues (the other
three companies have no sales data). Similarly, for the finishing subcategory, of the 105
companies with sales data, none of them would experience costs exceeding 3 percent of
baseline sales, if incurring the median compliance costs. Likewise, for all companies with
both coating and finishing operations, median costs are less than 3 percent of sales. Overall,
for only one company out of 185 companies with sales data are median costs more than 3
percent of their baseline sales. EPA thus believes that companies typically would find these
regulations affordable. This is confirmed by a comparison of costs of compliance with
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Table 4-3. Estimated Company Impacts
Coaters— 31332
Minimum Cost to Sales Ratios
CSR< 1%
1% < CSR < 3%
CSR > 3%
Data Not Available
Total
Median Cost to Sales Ratios
CSR< 1%
1% < CSR < 3%
CSR > 3%
Data Not Available
Total
Mean Cost to Sales Ratios
CSR< 1%
1% < CSR < 3%
CSR > 3%
Data Not Available
Total
Maximum Cost to Sales Ratios
CSR< 1%
1% < CSR < 3%
CSR > 3%
Data Not Available
Total
Number of
Companies
58
2
1
3
64
Number of
Companies
58
2
1
3
64
Number of
Companies
58
2
1
3
64
Number of
Companies
58
2
1
3
64
% of Total
91%
3%
2%
5%
100%
% of Total
91%
3%
2%
5%
100%
% of Total
91%
3%
2%
5%
100%
% of Total
91%
3%
2%
5%
100%
Finishers— 31331, 313311,
313312, and 31321 2 NAICS
Number of
Companies
102
3
0
60
165
Number of
Companies
102
3
0
60
165
Number of
Companies
32
30
43
60
165
Number of
Companies
4
5
96
60
165
% of Total
62%
2%
0%
36%
100%
% of Total
62%
2%
0%
36%
100%
% of Total
19%
18%
26%
36%
100%
% of Total
2%
3%
58%
36%
100%
Number of
Companies
17
2
0
0
19
Number of
Companies
17
2
0
0
19
Number of
Companies
13
2
4
0
19
Number of
Companies
8
4
7
0
19
% of Total
89%
11%
0%
0%
95%
% of Total
89%
11%
0%
0%
100%
% of Total
68%
11%
22%
0%
100%
% of Total
42%
21%
37%
0%
100%
All Companies
Number of
Companies
177
7
1
63
248
Number of
Companies
177
7
1
63
248
Number of
Companies
103
34
48
63
248
Number of
Companies
70
11
104
63
248
% of Total
71%
3%
0%
25%
100%
% of Total
71%
3%
0%
25%
100%
% of Total
42%
14%
19%
25%
100%
% of Total
28%
4%
42%
25%
100%
-------
industry profits. Comparing the compliance costs to industry profits indicates that the costs
are sufficiently small to have little overall impact on the profitability of the industry. Over
the period 1995 to 2000, industry profits for SIC 22, Textile Mill Products (broadly
equivalent to NAICS 313), ranged from losses of $349 million to profits of $4.8 billion,
depending on the year and the profit measure selected. The costs of compliance represent
only 1 or 2 percent of industry profits (although for 2000, when industry profits were
negative, investment in compliance capital might have been difficult).
4-12
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SECTION 5
OTHER IMPACT ANALYSES
The economic impacts associated with the NESHAP were described in the previous
section. Statements discussing additional impacts on small businesses, energy use, and
unfunded mandates are presented below.
5.1 Small Business Impacts
The Regulatory Flexibility Act (RFA) of 1980 as amended in 1996 by the Small
Business Regulatory Enforcement Fairness Act (SBREFA) generally requires an agency to
prepare a regulatory flexibility analysis of a rule unless the agency certifies that the rule will
not have a significant economic impact on a substantial number of small entities. Small
entities include small businesses, small organizations, and small governmental jurisdictions.
For purposes of assessing the impacts of the rule on small entities, a small entity is
defined as: (1) a small business according to Small Business Administration (SBA) size
standards for NAICS codes 31332, 313311, or 31321 with 1,000 or fewer employees, or
313312, with 500 or fewer employees; (2) a small governmental jurisdiction that is a
government of a city, county, town, school district or special district with a population of less
than 50,000; and (3) a small organization that is any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.
Based on the above definition of small entities and data reported in Section 2 of this
report, the Agency has determined that, of the 248 companies owning facilities in the fabric
coating and finishing industries, there may be as many as 181 small companies. (Companies
with no employment data were assumed small, but if EPA also has no sales data, no CSR
could be computed for them.) Of these 181 small companies, there are 40 in NAICS 31332,
Fabric Coating, 133 in the NAICS codes for fabric slashing, dyeing, and finishing, and 8
with operations in both subcategories. In the coating subcategory, costs are estimated based
on model plants, and EPA does not generally have sufficient data to estimate the costs for
individual facilities. To assess potential impacts on small businesses owning fabric coating
facilities, therefore, EPA collected additional process and control data for small businesses
that could potentially incur costs. EPA estimated facility-specific compliance costs for 18
5-1
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small businesses. The other 22 facilities owned by small companies are not projected to incur
costs.
EPA uses the ratio of costs of compliance to company sales to assess the severity of
impacts on small businesses. Table 5-1 shows the cost-to-sales ratio (CSR) analysis for the
coating subcategory. For the 18 identified small businesses in the coating subcategory for
which EPA has estimated facility-specific costs, 15 have costs less than 1 percent of
company sales. Two others have costs between 1 percent and 3 percent of company sales
and one has a cost-to-sales ratio greater than 3 percent (3.2 percent). The remaining 22 small
companies in the coating subcategory are not estimated to incur costs due to the regulation.
Table 5-1. Cost-to-Sales Ratios for Small Companies in the Fabric Coating
Subcategory
Cost-to-Sales Ratio
Zero costs
Less than 1%
1%
-------
5.2 Energy Impacts
Executive Order 13211 "Actions Concerning Regulations that Significantly Affect
Energy Supply, Distribution, or Use" (66 Fed. Reg. 28355, May 22, 2001) requires federal
agencies to estimate the energy impact of significant regulatory actions. The NESHAP will
trigger both an increase in energy use due to the operation of new abatement equipment as
well as a decrease in energy use due to a small decline in production of coated and finished
fabrics. These impacts are discussed below in greater detail.
5.2.1 Increase in Energy Consumption
Energy requirements for implementing the compliance options for fabric coating and
printing facilities include electricity to collect and treat ventilation air, electricity to light
permanent total enclosures, and natural gas to provide supplemental fuel for stable operation
of oxidizers and to generate the steam required for carbon regeneration. Table 5-2 presents a
summary of increased fabric coating and printing model plant and nationwide energy
requirements associated with implementing the compliance options. It should be noted that
no incremental electricity usage is estimated for the upgrade of catalytic oxidizer model
plants. This is because the air flow does not change. Similarly, no incremental energy usage
is estimated for the upgrade of carbon adsorber Models 3 and Model 4. For each model
plant, the increased efficiency comes from adding a carbon bed, reducing the cycle time
between carbon bed regenerations, and therefore reducing the HAPs released to the
atmosphere from breakthrough. There is no change in air flow or in the amount of steam
used for regeneration, which is a function of the organic HAP load entering the carbon bed.
5.2.2 Reduction in Energy Consumption
The economic model described in Section 4.2 predicts that increased compliance
costs will result in an annual production decline of 0.08 percent for coated fabrics and 0.02
percent for finished fabrics. This production decline will lead to a corresponding very small
decline in energy usage by manufacturers.
5.2.3 Net Impact on Energy Consumption
Given the very small reductions in energy use expected to result from market
responses to the rule, the estimated energy use shown in Table 5-2 is probably a reasonable
estimate of the overall energy impact of the regulation. The total electricity generation
capacity in the U.S. was 785,990 Megawatts in 1999 (DOE, 1999a). Thus, the electricity
5-3
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Table 5-2. Summary of Fabric Coating and Printing Subcategory Model and
Nationwide Energy Impacts
Number
of
Model Plants a
New add-on control device
Model 1, carbon adsorber
Model 1, catalytic oxidizer
Model 2, thermal oxidizer
Model 3, carbon adsorber
Upgrade of add-on control
device
Model 2, catalytic oxidizer
Model 3, catalytic oxidizer
Model 3, carbon adsorber
Model 4, catalytic oxidizer
Model 4, carbon adsorber
New coating room (pte)
Small
Medium
2
1
2
4
1
2
3
2
1
14
13
Large 29
Total energy impacts for model
plants except methylene chloride
model plants
Nationwide total energy impacts
except methylene chloride energy
impacts b
New add-on control system for
methylene chloride emissions c
Model 1, carbon adsorber
Model 3, carbon adsorber
Total methylene chloride control
energy impacts
Nationwide total energy impacts
with methylene chloride energy
impacts d
1
1
Model
Incremental
Electricity
Usage,
Kwh/y
8,933
11,293
28,857
119,517
0
0
0
0
0
11,200
12,250
12,600
15,742
186,588
Nationwide
Total
Electricity
Usage,
Kwh/y
17,866
11,293
57,714
478,068
0
0
0
0
0
156,800
159,250
365,400
1,246,391
2,567,565
15,742
186,588
202,330
2,769,895
Model
Incremental
Natural Gas
Usage, scf/y
418,941
2,360,755
36,332,289
2,714,142
691,592
1,090,910
0
1,723,795
0
0
0
0
418,941
2,714,142
Nationwide
Total Natural
Gas Usage, scf/y
837,882
2,360,755
72,664,578
10,856,568
691,592
2,181,820
0
3,447,590
0
0
0
0
93,040,785
191,664,017
418,941
2,714,142
3,133,083
194,797,10
(continued)
5-4
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Table 5-2 Footnotes
Number of model plants assigned to 14 facilities in the fabric coating MACT database and to 12 fabric
coating major facilities owned by small businesses to estimate the incremental energy requirement of
achieving the emission limits with add-on controls.
Nationwide totals for all plants in the fabric coating and printing industry, except plants with methylene
chloride emissions, are based on factoring the total energy usage for model plants except methylene chloride
model plants by the ratio of HAP emissions estimated for major HAP emission sources in the fabric coating
and printing subcategory (minus methylene chloride emissions) to the HAP emissions reported by facilities
in the fabric coating MACT database and major facilities owned by small businesses (the ratio is 2.06).
Includes energy usage of add-on control system and coating room.
Sum of nationwide total energy impacts except methylene chloride energy impacts and total methylene
chloride control energy impacts.
requirements associated with the abatement capital represent a small fraction of domestic
generation capacity. Similarly, the natural gas requirements associated with the NESHAP
are insignificant given the 23,755 billion cubic feet of natural gas produced domestically in
the U.S. in 1999 (DOE, 1999b). Hence, the NESHAP is not likely to have any significant
adverse impact on energy prices, distribution, availability, or use.
5-5
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REFERENCES
American Textile Manufacturer's Institute (ATMI) 1999. Textile Coating and Printing
Database.
Freedonia Group. 1999. Coated Fabrics in the United States to 2003—Introduction,
Executive Summary, Market Environment, Coated Shipments, Demand and Markets.
Available at .
Heil, S., and T.W. Peck, eds. 1998. Encyclopedia of American Industries 2nd Edition.
Volume 1: Manufacturing Industries. Detroit, MI: Gale Research.
Hellwig, G.V. October 30, 2000. Memorandum to Fabric Coating, Printing, and Dyeing
File. Fabric Coating Floor.
Ho, M., and Jorgenson, D. 1998. "Modeling Trade Policies and U.S. Growth: Some
Methodological Issues." Presented at USITC Conference on Evaluating APEC Trade
Liberalization: Tariff and Nontariff Barriers. September 11-12, 1997.
.
Hoover's Online. 2001. Companies and Industry. Available at
.
Howe-Grant, M. 1993. Kirk-Othmer Encyclopedia of Chemical Technology. Fourth
Edition. Volume 6: Chlorocarbons and Chlorohydrocarbons—C2 to Combustion
Technology. New York: John Wiley & Sons.
Industry News. 1999. "Coated Fabrics Shipments by Type." Journal of Coated Fabrics
29(1):6-10.
InfoUSA. Gale Group. 2000. INFOTRAC Database. .
Farmington Hills, MI: Gale Group.
Kroschwitz, J.I., ed. 1986. Encyclopedia of Polymer Science and Engineering. Volume 6:
Emulsion Polymerization to Fibers, Manufacture. New York: John Wiley & Sons.
Lexis/Nexis. 2001. Academic Universe Database, .
Bethesda, MD: Lexis/Nexis.
R-l
-------
Lycos Companies Online. 2001. Company Research. Available at
.
Marlow-Ferguson, Rebecca (ed.). 2001. Encyclopedia of American Industries. 3rd Edition.
Detroit, MI: Gale.
RTFs January 8, 2002 memorandum from Steve York and Alton Peters to Vinson Hellwig of
EPA, "Fabric Coating, Printing and Dyeing Nationwide Compliance Costs".
ReferenceUSA. 2001. ReferenceUSA Business Database Version 4.1.
Smith, W.C. 1999. "Coated and Laminated Fabrics—Putting the Industry in Perspective."
Journal of Coated Fabrics 28:292-299.
U.S. Census Bureau. 1992a. 1992 Census of Manufactures: Industry
Series—Miscellaneous Textile Goods.
.
U.S. Census Bureau. 1992b. 1992 Census of Manufactures: Industry Series—Rubber
Products. .
U.S. Census Bureau. 1992c. Concentration Ratios in Manufacturing, MC92-S-2. Available
at http://www.census.gov/mcd/mancen/download/mc92cr.sum>.
U.S. Census Bureau. 1999a. 1997 Economic Census: Manufacturing—Industry Series.
.
U.S. Census Bureau. 1999b. 1997 Economic Census: Manufacturing—Industry Series.
.
U.S. Census Bureau. 1999c. 1997 Economic Census: Manufacturing—Industry Series.
.
U.S. Census Bureau. 1999d. 1997 Economic Census: Manufacturing—Industry Series.
.
U.S. Census Bureau. 1997. Concentration Ratios in Manufacturing, EC97M31S-CR.
Available at .
U.S. Census Bureau. 2000. "Bridge Between NAICs and SIC." 1997Economic Census
Core Business Statistics Series. EC97X-CS3. Washington, DC: Government
Printing Office.
R-2
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U.S. Census Bureau. 2000a. Annual Survey of Manufactures—Industry Statistics.
.
U.S. Census Bureau. 2000b. Survey of Plant Capacity (1998): Current Industrial Reports.
.
U.S. Environmental Protection Agency (EPA). 1988. AP-42, Fifth Edition, Volume I,
Chapter 4: Evaporation Loss Sources. Available at
.
U.S. International Trade Commission (USITC). 1993. Industry and Trade Summary:
Coated Fabrics. Washington, DC: U.S. International Trade Commission.
U.S. International Trade Commission. 2001. Interactive Tariff and Trade DataWeb.
. As obtained August 22, 2001.
U.S. Small Business Administration (SB A), Office of Size Standards. 2001. Small Business
Size Standards. .
Warfield, et al. 2001. "Multifiber Arrangement Phaseout: Implications for the U.S.
Fibers/Textiles/Fabricated Products Complex."
www.fibronet.com.tw/mirron/ncs/9312/mar.html> As obtained September 19, 2001.
Wypych, J. 1988. Polymer Modified Textile Materials. New York: John Wiley & Sons.
R-3
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APPENDIX A
MODEL DATA SET AND SPECIFICATION
The primary purpose of the EIA for the proposed textile coating, printing, slashing,
dyeing and finishing NESHAP is to describe and quantify the economic impacts associated
with the rule. The Agency used a basic framework that is consistent with economic analyses
performed for other rules to develop estimates of these impacts. This approach employs
standard microeconomic concepts to model behavioral responses expected to occur with
regulation. This appendix describes the spreadsheet model in detail and discusses how the
Agency
• collected the baseline data set for the model,
• characterized market supply and demand for two markets—Fabric Coating Mills
(NAICS 31332) and Fabric and Textile Finishing Mills (NAICS 31331, 3132109,
313210P, 313210U),
• introduced a policy "shock" into the model by using control cost-induced shifts in
the domestic supply functions, and
• used a solution algorithm to determine a new with-regulation equilibrium for each
market.
A.I Baseline Data Set
EPA collected the following data to characterize the baseline year, 1997:
• Baseline quantity and prices—Value of shipments, import and export data from
for each market. We selected units for output such that the price in each market
equals one (see Table A-l).
• Domestic supply and demand elasticities—Warfield et al. (2001) report supply
and demand elasticity estimates used in the NTC-MFA model. Domestic
consumers are more responsive to small changes in price (demand elasticity
= -0.852) than domestic producers (supply estimate = 0.372).
A-l
-------
Table A-l. Baseline Data Set, 1997
Market
Fabric Coating Mills
(NAICS31332)
Fabric and Textile
Value
($106)a
2,259
17,200
Import Value
(106)b
474
49
Export Value
(106)b
603
41
Finishing Mills (NAICS
31331,3132109,
313210P, 313210U)C
a U.S. Bureau of the Census. 2000. "Bridge Between NAICs and SIC." 1997 Economic Census Core
Business Statistics Series. EC97X-CS3. Washington, DC: Government Printing Office.
b U.S. International Trade Commission. 2001. Interactive Tariff and Trade Data Web.
. As obtained August 22, 2001.
0 Foreign trade values are reported for NAICS 31331 only.
• Import supply and export demand elasticities—Supply and demand elasticities
used are shown in Table A-2. EPA was unable to identity empirical estimates of
import supply; therefore the Agency assumed import supply elasticity in the
coating market was double the domestic supply elasticity (= 0.744). Import
supply was assumed essentially perfectly elastic in the finishing market. Ho and
Jorgenson (1998) report export demand elasticities ranging from of-1.2 to -1.6
for textile mill industry. For this analysis, we used an average of-1.45.
A.2 Market Supply
Market supply is composed of domestic production (d) and imports (m):
Qs = qSd + qSm .
A. 2.1 Domestic and Import Supply
The change in quantity supplied by domestic producers can be approximated as
follows:
(A.1)
= q
Po
(A.2)
A-2
-------
Table A-2. Textile Supply and Demand Elasticities Used for the Market Models
Market Supply Demand
Domestic 0.372a -0.852a
Foreign 0.744b -1.450C
a Warfield, et al (2001). "Multifiber Arrangement Phaseout: Implications for the U.S.
Fibers/Textiles/Fabricated Products Complex." www.fibronet.com.tw/mirron/ncs/9312/mar.html> As
obtained September 19, 2001.
b Assumed value (2*domestic supply elasticity) for the coating market.
0 Ho, M, and Jorgenson, D. 1998. "Modeling Trade Policies and U.S. Growth: Some Methodological
Issues." Presented at USITC Conference on Evaluating APEC Trade Liberalization: Tariff and Nontariff
Barriers. September 11-12, 1997. .
where q s<1 is the baseline quantity, esa is the domestic supply elasticity, the term (Ap-c) is
the change in the producer's net price, and p0 is the baseline price. This is composed of the
change in baseline price resulting from the regulation (A p) and the shift in the domestic
supply function (c). The shift is calculated by taking the annual compliance cost estimate
and dividing it by baseline value of shipments (see Table A-3).
Table A-3. Domestic Supply Shifts, 1997
Market
Fabric Coating Mills
(NAICS31332)
Fabric and Textile
Value of Shipments
($106)
2,259
17,200
TACC
($106)
6.1
8.5
Supply Shift
(TACC/Value of
Shipments)
0.269%
0.049%
Finishing Mills (NAICS
31331,3132109,
313210P, 313210U)
The change in quantity supplied by foreign producers of coated fabrics can be
approximated as follows:
A Sn, S™ Sn, AD
Aq m = ^ - • B - • ^
Po
A-2
-------
where q Sm is the baseline level of imports, gsm is the import supply elasticity, and p0 is the
baseline price. Foreign coated fabric producers do not face additional pollution control costs,
therefore their net price change equals the gross price change which is positive. As a result,
foreign producers increase output in response to higher prices. Foreign producers of finished
fabrics are assumed to increase their supply to compensate completely for reductions in
domestic production of finished fabrics. Insert equation Delta qsm=-Delta qsd
A Qsm = A Qsd
Import supply of finished fabrics is assumed to be essentially perfectly elastic over the
relevant range, so that market price and quantity of finished fabrics is unchanged by the rule.
A.2.1.1 Producer Welfare Measurement
For affected domestic supply, the change in producer surplus can be approximated
with the following equation:
APSd = qdl-(Ap-c) + 0.5-Aqd-(Ap-c) . (A.4)
Increased control costs and output declines have a negative effect on domestic producer
surplus. However, these losses are mitigated to some degree as a result of higher market
prices.
In contrast to domestic producers, foreign producers of coated fabrics do not face
additional pollution controls and their change in producer surplus can be approximated as
follows:
APSm = q^-Ap + 0.5-Aqm-Ap (A.5)
With regulation, both price and output increase for these producers leading to unambiguous
producer surplus gains. For foreign producers of finished fabrics, quantity increases but
producers surplus remains unchanged because price is unchanged.
A. 2.2 Market Demand
Market demand is composed of domestic consumption (d) and exports (x):
Q°d = q°d+ qD" (A.6)
A-4
-------
A. 2.2.1 Domestic and Export Demand
The change in quantity demanded by domestic and foreign consumers can be
approximated as follows:
A I>i Di Dj p
Aq ' = ^ ' • TI ' • -£ (A 7)
Po
where qj3 is baseline consumption, r|D is the demand elasticity of the respective consumer
(i), and (A p) is the change in the market price.
A. 2.2.2 Consumer Welfare Measurement
The change in domestic and foreign consumer surplus is approximated as follows:
ACSj = - qu-Ap + 0.5-Aqj-Ap . (A.8)
As shown, higher market prices and reduced consumption lead to welfare losses for domestic
and foreign consumers of coated fabrics. Because the market price and quantity of finished
fabrics is unchanged by the rule, no change in consumer surplus occurs in that market.
A.3 With Regulation Market Equilibrium Solution
The new with-regulation equilibrium arises where change in total market supply
equals the change in market demand (i.e., A Qs = A QD). EPA used the model equations
outlined above and a solver application available in commercial spreadsheets to compute the
new equilibrium in prices and quantities.
A-5
-------
TECHNICAL REPORT DATA
(Please read Instructions on reverse before completing)
1. REPORT NO.
EPA-452/R-03-008
3. RECIPIENT'S ACCESSION NO.
4. TITLE AND SUBTITLE
Economic Impact Analysis of the Fabric and Textile Printing,
Coating, and Dyeing NESHAP: Final Rule
5. REPORT DATE
February 2003
6. PERFORMING ORGANIZATION CODE
7. AUTHOR(S)
Lisa Conner, Innovative Strategies and Economics Group
8. PERFORMING ORGANIZATION REPORT NO.
9. PERFORMING ORGANIZATION NAME AND ADDRESS
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Air Quality Strategies and Standards Division
Research Triangle Park, NC 27711
10. PROGRAM ELEMENT NO.
11. CONTRACT/GRANT NO.
12. SPONSORING AGENCY NAME AND ADDRESS
13. TYPE OF REPORT AND PERIOD COVERED
John Sietz, Director
Office of Air Quality Planning and Standards
Office of Air and Radiation
U.S. Environmental Protection Agency
Research Triangle Park, NC 27711
14. SPONSORING AGENCY CODE
EPA/200/04
15. SUPPLEMENTARY NOTES
16. ABSTRACT
This report presents a technical analysis of the economic impacts associated with the National Emissions
Standard for Hazardous Air Pollutants to control emissions of air toxic pollutants from the Fabric and
Textile Printing, Coating, and Dyeing industry. The analysis evaluates adjustments in the fabric
printing, coating, and dyeing markets (through price and production changes), social cost, and the
resulting affects on employment, international trade, and small businesses.
17.
KEY WORDS AND DOCUMENT ANALYSIS
DESCRIPTORS
b. IDENTIFIERS/OPEN ENDED TERMS
c. COSATI Field/Group
Economic Impact Analysis (EIA)
Regulatory Flexibility Analysis (RFA)
Air Pollution control
economic analysis
small business analysis
18. DISTRIBUTION STATEMENT
Release Unlimited
19. SECURITY CLASS (Report)
Unclassified
21. NO. OF PAGES
20. SECURITY CLASS (Page)
Unclassified
22. PRICE
EPA Form 2220-1 (Rev. 4-77)
PREVIOUS EDITION IS OBSOLETE
-------
United States Office of Air Quality Planning and Standards Publication No. EPA 452/R-03-008
Environmental Protection Air Quality Strategies and Standards Division February 2003
Agency Research Triangle Park, NC
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