On Friday, Mexican tariffs on more than $2.4 billion of U.S. goods, including a 5% duty on most U.S. pork going into Mexico, was reduced by 50%, following the signing last Wednesday of a joint trade agreement permitting Mexican trucks to haul goods into the United States.
The National Pork Producers Council led an agriculture coalition urging the United States to honor its trade obligations on trucking under the North American Free Trade Agreement (NAFTA).
NPPC called the move a “good first step.”
When the first Mexican trucks carry product into the United States later this summer, the duties will be suspended, according to NPPC officials.
The NAFTA trucking provision was set to become effective in December 1995. But U.S. failure to abide by the deal led to a 2001 NAFTA dispute panel ruling that excluding Mexican trucks violated U.S. obligations under the trade deal.
That ruling gave Mexico the right to retaliate, but the United States delayed the retaliation by implementing a pilot program in 2007 that allowed a limited number of trucks into America.
Then in March 2009, when Congress failed to renew the pilot program, Mexico imposed tariffs on 89 U.S. products. Pork was added to the list in August 2010 after the Obama administration failed to present a proposal for resolving the trucking dispute.
Mexico is the second-largest market for U.S. pork, shipping $986 million to Mexico in 2010.