In 2009, Congress eliminated funding for a pilot cross-border trucking project, stating continued concerns about the safety of Mexican trucks. The Mexican government argued that the trucking program ban puts the US in violation of the North American Free-Trade Agreement’s (NAFTA) cross-border trucking commitments and a NAFTA dispute-settlement panel agreed, allowing Mexico to retaliate by placing steep tariffs on US goods, including pork.
Since the pilot program’s elimination, LaHood and other administration officials have met with lawmakers, safety advocates and industry representatives. The initial concept document attempts to address concerns raised during that process.
“We are encouraged that the Administration recognizes the importance of meeting our NAFTA obligations, especially with our closest and biggest trading partners. We hope this will lead to quick resolution and elimination of Mexico’s duties on US pork products,” said J. Patrick Boyle, AMI’s president and CEO.
The Obama administration’s announcement is a step in the right direction and comes not a moment too soon, said Colin Woodall, National Cattlemen’s Beef Association vice president of government affairs. “It is critical for all farmers and ranchers and for the entire US economy that this long-running US-Mexico trucking dispute comes to an immediate resolve,” he added. “The retaliatory tariffs Mexico has placed on US agricultural exports as a result of this dispute is costing the US an enormous amount of money and jobs for US workers. This is a good first step but it is of little value if our countries do not move forward to end the dispute as expeditiously as possible.”
The National Pork Producers Council also welcomed the news from the US Department of Transportation. US pork exports to Mexico have dropped by 11% since Mexico announced in August 2010 it would hit US pork exports with a retaliatory import duty in response to failure of the US to abide by its commitments made to Mexico in the North American Free Trade Agreement.
“Mexico is our largest volume export market and the retaliation Mexico has put in place on pork has hurt US pork producers,” said NPPC President Sam Carney, a pork producer from Adair, Iowa. “We applaud any effort by the US Administration that will lead to progress in resolving this issue. Every month that the trucking issue goes unresolved, we continue to lose market share in Mexico – one of our most important export markets.”
The US shipped $762 million in pork products to Mexico in 2009. Since 1993, the year before the NAFTA was implemented, US pork exports to Mexico have increased by 580%.