LITTLE ROCK — Arkansas’ U.S. Sens. John Boozman, a Republican, and Democrat Mark Pryor were among 16 members of the upper chamber who asked U.S. Trade Representative Ron Kirk this week to oppose a proposed Mexican tariff on imports of chicken leg quarters.
“With U.S. poultry exports to China significantly decreased due to frivolous anti-dumping duties, Mexico is our most important market, importing nearly 250,000 metric tons in the most recent year valued at nearly $270 million,” the lawmakers said in a letter to Kirk.
The two countries are involved in negotiating Mexico’s entry into a trade agreement called the Trans-Pacific Partnership. Other countries participating in the agreement that will be finalized in the coming year include Australia, Brunei Darussalam, Chile, Malayasia, New Zealand, Peru, Singapore and Vietnam.
The proposed duties range from 64 percent to 129 percent.
Mexico is the country’s largest consumer of leg quarters, poultry trade groups say.
Industrias Bachoco, Mexico’s leading poultry producer and one of three businesses to initiate the anti-dumping case in early 2011, said U.S. producers in 2010 dumped leg quarters that were drastically reduced in price onto its market.
Industrias Bachoco, which is also the new Mexican owner of Fort Smith-based O.K. Food Industries, in mid-January posted details from the Mexican Ministry of Economy’s initial findings on its website.
The commercial chicken industry is forecast to produce 36 billion pounds of meat in 2012, according to USDA data. And last year, nearly 7 billion pounds were sent to countries such as Mexico, Canada, the Philippines and China.
Mexico imported about 551 million pounds of leg quarters last year, according to the National Chicken Council.
“If Mexico imposes very high duties on U.S. leg quarters, the market will decrease dramatically,” said Bill Roenigk, an economist with the council.
Arkansas is the country’s second-largest poultry producing state, behind Georgia according to USDA data.
In 2010, the state’s poultry farmers grew 5.9 billions pounds of chicken. Tyson Foods Inc. of Springdale is the nation's largest poultry producer.
All U.S. chicken exports to Mexico have been duty-free for the past 2 1/2 years because of trade provisions included in the 1994 North American Free Trade Agreement, according to the USA Poultry and Egg Export Council of Stone Mountain, Ga. But Mexico is now threatening to end that.
Mexico is expected to issue a final opinion on the duties in August, said Jim Sumner, president of the exporting trade group.
“We would be most pleased if our government could convince Mexico to drop the [anti-dumping] case,” he said.
Business, Pages 25 on 04/04/2012