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NAFTA AGRICULTURE
FACT SHEET:
Orange Juice
TREATMENT OF TARIFFS:
U.S. and Mexican tariffs on frozen concentrated orange juice (FCOJ) and single-strength juice are being phased out over 15 years.
The United States created a tariff-rate quota for FCOJ that gives Mexico annual access for 40 million gallons (single strength equivalent) at one-half of the MFN tariff rate. There will be no growth in the quota volume over the transition period. The over-quota tariff, beginning at the rate of 9.25 cents per liter, is being reduced 15 percent over the first 6 years, remains constant for years 7 through 10, and then will be phased-out in equal installments over the remaining 5 years. The in-quota tariff remains unchanged as the over-quota rate falls. When the two rates are equal in year 13, the in-quota rate will be phased out at the same rate as the over-quota rate.
For single-strength orange juice, Mexico created a tariff-rate quota for 4 million gallons of juice at one-half the MFN tariff. Any juice above this quantity is assessed the MFN rate based on a 15- year straight-line phaseout of the tariff. The in-quota tariff remains unchanged until it equals the over-quota tariff (in year 8), at which point it will be phased out at the same rate as the over-quota tariff.
For other orange juice made from concentrate, the U.S. tariff is being phased out over 15 years.
Mexico matched the U.S. tariff line changes, duties, and 15-year phaseout periods. Mexico's new specific duties are being phased out over the applicable transition period. The duty assessed on imports from the United States cannot exceed Mexico's own ad valorem duty of 20 percent.
PRICE-BASED SAFEGUARD
A price-based safeguard was added to the existing provisions on FCOJ as part of the NAFTA implementing legislation.
The safeguard provides for the reimposition of higher MFN tariffs if FCOJ daily average prices for 5 consecutive days fall below the previous 5-year average for that month.
Between the years 1994 and 2002, the safeguard only applies after U.S. imports from Mexico exceed 80 million gallons; between the years 2003 and 2007 imports must exceed 100 million gallons.
TREATMENT OF QUANTITATIVE RESTRICTIONS:
There are no quantitative restrictions affecting trade in orange juice.
RULES OF ORIGIN:
For citrus, all single-fruit juices -- fresh, frozen, concentrated, reconstituted, and fortified -- must be made from 100-percent NAFTA fresh citrus fruit.
U.S. Orange Juice Trade with Mexico
Frozen Orange Juice, Concentrated
Calendar Year |
1990 |
1991 |
1992 |
1993 |
1994 |
1995 |
1996 |
Export Value |
788 |
207 |
556 |
124 |
293 |
190 |
739 |
Export Volume |
1,682 |
488 |
1,123 |
250 |
459 |
329 |
2,438 |
Import Value |
65,971 |
41,524 |
6,178 |
13,738 |
40,584 |
57,489 |
50,176 |
Import Volume |
169,659 |
176,026 |
22,043 |
76,910 |
164,972 |
240,748 |
174,667 |
Value in $1,000; volume in kiloliters.
Orange Juice, Not Concentrated
Calendar Year |
1990 |
1991 |
1992 |
1993 |
1994 |
1995 |
1996 |
Export Value |
83 |
228 |
670 |
805 |
1,170 |
429 |
999 |
Export Volume |
122 |
339 |
927 |
1,026 |
1,594 |
548 |
1,338 |
Import Value |
22,606 |
3,487 |
848 |
527 |
2,438 |
5,181 |
4,531 |
Import Volume |
69,904 |
10,815 |
2,897 |
2,364 |
8,664 |
19,284 |
13,446 |
Value in $1,000; volume in kiloliters.
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