In Seattle, Address the Cross-Border Trucking Dispute

By August 16, 2010Infrastructure, Trade

When President Obama speaks in Seattle on exports Tuesday, we hope he’ll shed some light on the continued delays in resolving the Mexican cross-border trucking issue.  After all, he’s raising campaign money that same day for Sen. Patty Murray (D-WA), who has worked to resolve the trade dispute that is notably costing Washington State farmers — and manufacturers across the country — millions of dollars in lost sales.

In March 2009, the Mexican government imposed retaliatory tariffs on selected U.S. agricultural and manufactured goods because the United States (in this case, Congress) had violated NAFTA by blocking enactment of a cross-border trucking program.

Potato and frozen potato products are among those hit hard by the tariffs. As the Northwest-based ag newspaper, The Capital Press, reported last week, “Senate seeks solutions to dispute“:

Tariffs of 20 percent on U.S. frozen potato products have been in effect since March 19, 2009. The tariffs cost the industry more than $33 million in revenue during the 12 months ending in March, officials estimate.

“It’s just phenomenal the amount of revenue that’s been lost,” Matt Harris, director of trade for the Washington State Potato Commission, said in an interview.

Washington is the nation’s largest producer of frozen potato products, historically providing about half of all shipments to Mexico. Nearly 90 percent of the state’s spud crop is used to make products such as frozen french fries and hash browns.

Because of the tariffs, major potato processors have begun sourcing Mexican shipments from Canada rather than U.S. plants, industry officials said.

Sen. Murray had language inserted into the committee report for the FY2011 Transportation and HUD appropriation bill (S. 3644) requiring the Administration to put forward a plan by Oct. 1 to end the dispute and retaliatory tariffs. As she said in a release:

“I am extremely frustrated that the Administration has not yet acted while farmers across my home state of Washington continue to suffer under Mexico’s retaliatory tariffs,” said Senator Patty Murray. “I am urging both the Obama Administration and the Mexican government to solve this issue and allow Washington state farmers to compete on a level playing field. Since there has been inaction for too long, I included specific language in the transportation spending bill giving the Administration a clear deadline of October 1, 2010 to solve this problem.”

Good. Unfortunately, Congress is likely to pass few if any appropriations bills in September, but perhaps Murray’s language will be included in a continuing resolution. In any case, we look forward to hearing the President’s remarks on the issue.

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