The Hagstrom Report

Agriculture News As It Happens

U.S., Mexico agree on trucking plan and end to tariffs

An agreement between the Obama administration and the Mexican government to resolve a two-year long cross-border long-haul trucking dispute and end Mexico’s punitive tariffs on U.S. products announced today has won praise from a wide range of agricultural groups that export to Mexico.

Citing safety concerns, the U.S. government had not allowed the Mexican trucks to travel in the United States, even though the North American Free Trade Agreement called for free movement of the vehicles.

Agriculture Secretary Tom Vilsack announced that the governments of Mexico and the United States, which was represented by Transportation Secretary Ray La Hood, had agreed to a deal that would end the high Mexican tariffs that had reduced U.S. ag exports to Mexico by 27 percent.

Vilsack said the agreement would allow Mexican trucks to enter the United States under a “phased-in program built on the highest safety standards.” Vilsack said the phase-ins begin on July 8, when Mexico reduces the existing tariffs on U.S. goods by 50 percent and that the remaining 50 percent will be suspended within five business days from the date on which the first Mexican carrier receives authorization under the new program. The total lifting could occur in as little as 45 days, Vilsack said.

The American Farm Bureau Federation, the National Cattlemen’s Beef Association, the National Pork Producers Council, the International Dairy Foods Association, the United Fresh Produce Association and Western Growers all praised the Obama administration and the Mexican government for reaching the agreement, and noted the importance of Mexico as an export market.

But farm leaders may still be worried that Congress might try to stop the agreement from moving forward.

“It is important that the U.S. live up to its trade agreement obligations under the North American Free Trade Agreement allowing for the cross-border delivery of international cargo from Mexico into the United States,” American Farm Bureau Federation President Bob Stallman said. “Any effort by Congress to prohibit this from moving forward will cause Mexico to once again put tariffs in place, putting the burden of non-compliance back on U.S. farmers.”