Northey Supports US-Mexico Trucking Program

Northey Supports US-Mexico Trucking Program

Iowa Secretary of Agriculture Bill Northey expresses support for the U.S.-Mexico cross-border trucking proposal, a pilot program that will hopefully help resolve a trade dispute between Mexico and the United States. The dispute is affecting Iowa pork producers.

Iowa Secretary of Agriculture Bill Northey last week submitted comments to the U.S. Department of Transportation in support of a proposal that would create U.S.-Mexico cross-border trucking pilot program.

The program will move the U.S. towards compliance with the trucking provisions of the 1994 North America Free Trade Agreement. Last August, the Mexican government placed a tariff on U.S. bone-in hams and pork skins, among other products, in retaliation for the U.S.'s non-compliance.

"This dispute is having a real impact on pork producers in Iowa and I am glad they are moving forward with this program," says Northey. "There is an agreement in place that the tariffs will be removed once this program is in place and trucks begin moving across the border."

Here is Northey's letter to the U.S. Department of Transportation:

Docket Management Facility, (M-30)

U.S. Department of Transportation (DOT)

1200 New Jersey Avenue, SE.

West Building, Ground Floor, Room 12-140

Washington, DC 20590-0001

Re: Pilot Program on NAFTA Long-Haul Trucking Provisions

Docket Number FMCSA-2011-0097

To Whom it May Concern:

I am writing to express my strong support for the proposal by the Federal Motor Carrier Safety Administration to create a U.S.-Mexico cross-border long-haul trucking pilot program to test and demonstrate the ability of Mexico-based motor carriers to operate safely in 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 5 percent tariff on U.S. bone-in hams – a big export item – and 20 percent tariff on cooked pork skins in retaliation for the United States not complying with the trucking provision of the 1994 North American Free Trade Agreement. The provision was supposed to become effective in December 1995.

The damage to our pork producers in Iowa and across the nation as a result of these tariffs has been painfully clear.

Previously, Mexico was the second largest market for the U.S. pork industry, which shipped $986 million of pork south of the border in 2010, or about 20% of our total pork exports from the U.S.  Since 1993 – the year before NAFTA was implemented – U.S. pork exports to Mexico have increased by 780%.

After the tariffs were put in place, the U.S. pork industry saw exports to Mexico of the targeted products fall by from 17,400 metric tons to 12,900 metric tons in the first month, which in dollar terms is a loss of $8 million in a four-week period.  The decline has continued.  U.S. exports from August to December 2010 were down by 9 percent from the same period the year before.  Meanwhile, Canadian exports grew by 99 percent during the same period.

Iowa, as the national leader in pork production, cannot avoid being negatively impacted as a result of this situation.

The initial pilot program that was put in place in 2007 that allowed a limited number of Mexican trucks to make deliveries to Chicago has proven successful and showed that Mexican trucks and drivers are no less safe those in the U.S.

As a result, I would again express my support for this proposal and ask that you continue to move forward a quickly as possible to adopt the proposal.

Thank you for your consideration.

Sincerely,

Bill Northey

Iowa Secretary of Agriculture           

Cc:       Senator Chuck Grassley

            Senator Tom Harkin

            Representative Tom Latham

            Representative Steve King

            Representative Leonard Boswell

            Representative Bruce Braley

            Representative David Loebsack

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