Letting Mexican trucks into the U.S. isn’t a problem for fresh produce growers and distributors, industry representatives say.
But Mexico’s tariffs, which have cost U.S. fruit and vegetable growers millions of dollars in lost business, are a problem. And until the U.S. and Mexico resolve a dispute over cross-border trucking, fresh produce business will continue to suffer, sources say.
“You can’t get rid of the tariffs until you get rid of the trucking issue,” said Allison Moore, spokeswoman with the Fresh Produce Association of the Americas, Nogales, Ariz. “The U.S. needs to realize it’s not just a trucking issue. It’s a greater trade issue that affects business on both sides of the border.”
Because of the tariffs, some growers have stopped shipments, Moore said.
Cross-border trucking isn’t a necessity for the U.S. fresh produce industry, largely because of the nature of the business, Moore and others in the industry said in late January.
In Nogales, Mexican truckers typically drop bulk loads of fruits and vegetables at warehouses and then return to farms across the border to fill up again. Having the truckers drive hundreds or thousands of miles into the U.S. would reduce capacity to ship more produce in from Mexico, Moore said.
Moore said the restrictions on Mexican truckers don’t affect business in Nogales.
“We’re basically a big terminal market,” Moore said. “A lot of people don’t want a straight load of something. They want mixed loads, and it’s easier to do that here.”
Under the 1994 North American Free Trade Agreement, truckers from Mexico were to be allowed into the U.S. with no mileage restrictions, though that provision was never put into effect. Currently, Mexican trucks are permitted in the U.S. within a 20- to 25-mile border zone.
After the U.S. canceled a pilot program to let Mexican truckers travel throughout the U.S., Mexico in early 2009 imposed tariffs of 5% to 25% on U.S. products, including pears, grapes and potatoes. In August, Mexico expanded the tariff list to include apples, sweet corn, grapefruit and oranges.
The tariffs have cost U.S. fresh produce growers an estimated $208 million in lost business, said Ken Barbic, director for federal government affairs for Western Growers, Irvine, Calif.
While there are signs the two sides are making progress toward resolving the dispute, “until they come up with a negotiated solution, it’s not solved,” Barbic said. “It’s still frustrating from that standpoint.”
Earlier this month, the U.S. Department of Transportation outlined a framework for cross-border trucking negotiations in a “concept document” that addressed issues including driver and vehicle safety, emissions standards, language ability and truck inspection. Shortly after that, Mexico said it will maintain tariffs but won’t add to or change the list of U.S. goods subject to the tariffs.
Produce groups say the U.S. should live up to its obligations under NAFTA. Barbic said he hopes the dispute ends before the start of the growing season for many U.S. crops.
But until the dispute is resolved, “we’re still going to have those tariffs,” Barbic said. “We’re still in a holding pattern.”