By DOUG SCHMITZ
Iowa Correspondent

ADAIR, Iowa – The National Pork Producers Council (NPPC) is urging the federal government to quickly resolve the Mexican trucking dispute that has been brewing for nearly two years.

“The trucking issue needs to be resolved now, before the U.S. pork industry loses even more of its market share in Mexico,” said Sam Carney, NPPC president and an Adair, Iowa, pork producer. “We’re talking about the livelihoods of American hog farmers; we’re talking about lost U.S. jobs,” he added. “And it isn’t just the pork industry; this is happening to the producers of the other 98 products on the retaliation list.”

The NPPC said the 20 percent drop in U.S. pork exports has severely hurt the industry since the Mexico government added pork products to its retaliation list in August, in which a 5 percent tariff was placed on most U.S. pork imports and other products.

Mexico also added dairy and apples to its initial retaliation list of 89 products after the Obama administration reneged on presenting a proposal for resolving the trucking issue.

The controversy first erupted in March 2009 when Mexico slapped higher tariffs on an estimated $2.4 billion of U.S. goods after they claimed the U.S. Congress failed to renew a pilot program created by the Bush administration in 2007 that let a limited number of Mexican trucking companies haul freight beyond a 25-mile U.S. commercial zone.

But Congress stopped funding the pilot program in March 2009, which had effectively prohibited Mexican trucks from gaining free access to all U.S. roads.

The NPPC said Mexico’s higher tariffs were in reprisal for the United States not complying with a provision of the 1994 North American Free Trade Agreement (NAFTA) that allows Mexican trucks to haul goods into America, which was supposed to become effective in December 1995.

Under the NAFTA deal, the U.S. and Mexico agreed to permit each other’s trucks to enter the interior of the other country after a phase-in period, expanding the border zone access that had been in place for years.

Currently, Mexico is the second largest market for the U.S. pork industry, which shipped $762 million of pork south of the border in 2009. Since 1993 – the year before NAFTA was implemented – U.S. pork exports to Mexico have increased by 580 percent.

But according to recent data from the U.S. Department of Commerce and the Canadian government, U.S. pork exports to Mexico dropped by nearly 5,000 metric tons from August to September – a loss of about $9 million, while Canadian pork exports increased by almost 2,000 metric tons.

Along with the NPPC, 37 state pork groups have also urged the Obama administration to end the U.S.-Mexico dispute, which included the Illinois Pork Producers Assoc., the Indiana Pork Producers Assoc., the Iowa Pork Producers Assoc., the Kentucky Pork Producers Assoc., the Michigan Pork Producers Assoc., the Ohio Pork Producers Council and the Tennessee Pork Producers Assoc.

“The U.S. pork industry is just now coming out of a difficult 28-month period, during, which producers faced dramatically higher input costs, reduced global demand because of recession and trade barriers unjustly erected after the H1N1 flu outbreak,” the groups stated in a joint letter on Sept. 20 to Obama.

“The economic health of the sector and the businesses that support it depend on sales to foreign markets that we fought hard to open and re-open. We cannot afford now to jeopardize our exports to Mexico,” the letter continued. “We urge you, therefore, to work with the Congress and the Mexican government to resolve the trucking issue as quickly as possible.”