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Article: NAFTA is upon us. (free trade and the dairy products industry) (News & Trends: Washington Watch) (Industry Overview)
- Article from:
- Dairy Foods
- Article date:
- January 1, 1994
- Author:
CopyrightCOPYRIGHT 1994 BNP Media. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The North American Free Trade Agreement that took effect Jan. 1 is expected to promote an expansion of U.S. dairy product exports to Mexico. But with lower feed costs in Mexico, some expansion is expected in that country's dairy industry as well.
Mexico will be granted a small duty-free quota for Section 22 products in the U.S. market and will be charged a high tariff based on the 1989-91 level of protection for any sales over that amount.
The duty-free quota will increase at a 3% compounded annual rate over the NAFTA transition period, while the over-quota tariff will be phased out gradually. For dairy products, the phase-out period will be 10 years.
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