C. The National Pork Producers Council praised the Obama administration for announcing an agreement in principle with Mexico to resolve a trade impasse over allowing Mexican trucks to haul goods into the United States.
The trucking dispute prompted Mexico to place tariffs on a host of U.S. products, including pork. In August, Mexico put a five percent tariff on U.S. bone-in hams – a big export item – and 20 percent on cooked pork skins in retaliation for the United States not complying with the trucking provision of the 1994 North American Free Trade Agreement (NAFTA). The provision was supposed to become effective in December 1995.
The National Pork Producers Council has been urging the Obama administration to resolve as quickly as possible the trucking issue, which erupted in March 2009 when Mexico placed higher tariffs on an estimated $2.4 billion of U.S. goods after the U.S. Congress cut off funding to renew a pilot program that let a limited number of Mexican trucking companies to haul freight beyond a 25-mile U.S. commercial zone.
This was great news for the U.S. pork industry, as well as for other sectors affected by Mexico’s retaliatory tariffs, said NPPC President Sam Carney, a pork producer from Adair, Iowa. Pork producers had been hurt by this retaliation.
NPPC cautioned that the issue won’t be completely resolved until the United States is in full compliance with its NAFTA obligation on trucking. Mexico has agreed to suspend its retaliatory tariffs. Opponents of the NAFTA trucking provision claim there are safety issues with Mexican trucks, but available data, including data collected as part of the pilot program, demonstrate the safety of Mexican trucks, which must meet U.S. standards.
Mexico is the second largest market for the U.S. pork industry, which shipped $986 million of pork south of the border in 2010. Since 1993 – the year before NAFTA was implemented – U.S. pork exports to Mexico have increased by 780 percent.
Source: National Pork Producers Council