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NAFTA AGRICULTURE
FACT SHEET:
Fresh Potatoes
TREATMENT OF TARIFFS:
Upon enactment of the NAFTA on January 1, 1994, the United States eliminated its tariff of 0.77 cent per kilogram on yellow (Solano) potatoes. All other potatoes became duty-free on January 1, 1998.
The U.S. duty on seed potatoes was eliminated. Mexico has no duty on seed potatoes.
TREATMENT OF QUANTITATIVE RESTRICTIONS:
When the NAFTA went into effect, Mexico converted its import licensing regime for fresh table potatoes imported from the United States (and Canada) to a transitional tariff-rate quota (TRQ). The TRQ will be in effect for 10 years.
The United States gained duty-free access to the Mexican market for an initial quota of 15,000 metric tons of fresh potatoes, which grows at a 3-percent annual rate over the 10-year transition period. The quota for 1998 is 16,883 metric tons.
U.S. exports to Mexico in excess of the quota will be assessed a tariff (based on the "tariffication" of Mexico's import license) initially equal to $354 per metric ton, but not less than 272 percent. Over the first 6 years of the agreement, an aggregate 24 percent of this over-quota tariff is being eliminated, with the remainder to be phased out over the rest of the 10-year transition period. The tariff for 1998 is $283 per metric ton, but not less than 217.6 percent.
The NAFTA also established a separate TRQ of 4,000 metric tons for Mexico's fresh table potato imports from Canada. The annual growth rates for Canada's quota, the initial level of the over-quota tariff, and the over-quota tariff phaseout is the same as those set for the United States.
U.S. Fresh Potato Trade with Mexico
Calendar Year |
1990 |
1991 |
1992 |
1993 |
1994 |
1995 |
1996 |
Export Value |
1,000 |
3,799 |
4,270 |
5,531 |
6,486 |
6,214 |
9,524 |
Export Volume |
5,195 |
11,062 |
14,679 |
17,409 |
16,054 |
15,572 |
25,536 |
Value in $1,000; volume in metric tons. U.S. imports from Mexico are zero or very small.
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