U.S. Senator Amy Klobuchar on Thursday urged the U.S. International Trade Commission to address unfair trade practices by foreign paper producers hurting the U.S. paper industry, including mills in Duluth and Cloquet.

Klobuchar testified at an International Trade Commission hearing on a complaint filed one year ago by U.S. paper companies, including New Page Corporation, which owns a Duluth mill, and Sappi Fine Paper, which operates a mill in Cloquet.

The United Steelworkers also have joined the complaint against imports of coated paper from China and Indonesia, which critics say is being sold here at below fair market value.

If both the Department of Commerce and the ITC find in favor of U.S. paper producers, the Department of Commerce may issue “anti-dumping duty orders’’ against coated paper imports as early as November.

“Minnesota has always been a leader in the American paper industry,” Klobuchar said in a news release. “But unfair trade practices are currently undercutting our domestic producers. American workers and businesses deserve to operate on a level playing field with our foreign competitors, and this requires proper enforcement of anti-dumping and countervailing duty laws.”

U.S. papermakers say Chinese and Indonesian imports have increased by 40 percent in 2009 and now make up 30 percent of the U.S. market. The unnatural growth in foreign paper production has driven U.S. producer shipments down to 38 percent of the U.S. market. Industry officials say more than 150,000 papermaking jobs have been lost in the U.S. since 2002.

The Sappi mill in Cloquet employs 750 people while the New Page mill in Duluth has 250 workers.

Meanwhile Thursday, Klobuchar said a $3 million federal expenditure to spur production of wood-based diesel and jet fuel at paper mills is included in the Senate Department of Defense Appropriations bill that recently passed the Senate Appropriations Committee.

The $3 million would fund research and development of alternative fuels produced as a byproduct of the papermaking process. The project is sponsored by a consortium of paper companies including UPM-Kymmene, which operates a mill in Grand Rapids, along with Sappi and New Page.

The legislation must now be considered by the full Senate before being reconciled with the House of Representatives’ legislation and signed into law by the president.