From Field to Fork

What do sweet corn, pistachios, oranges, grapefruit, and apples have in common? They’re the latest fresh produce additions to the Mexican tariff retaliation efforts. As you know, the U.S. Congress stopped a cross-border trucking safety pilot project run by the U.S. Department of Transportation by eliminating funding for the project in early 2009. This prompted Mexico to announce retaliatory tariffs on U.S. manufactured and agricultural exports to Mexico, including several produce crops. In mid-August, Mexico added new items, including these five produce commodities, to the list in an effort to pressure the United States to take action.

This has been going on for about 18 months now, and the products involved are either not moving into Mexico or are moving at significantly reduced levels. That’s enough of a problem, but the longer the stalemate lasts, the more other trading partners are filling the supply gaps in Mexico left by a lack of U.S. product. Those trading relationships continue to strengthen and may replace the U.S. supplier – Mexican buyer relationships for the long haul. We continue to urge the Obama administration to resolve this.

In addition, the Alliance to Keep U.S. Jobs (of which PMA is a member) continues to urge the Administration to do what it takes to solve this problem. Beyond the trade issues, this issue has resulted in more than 25,000 jobs being threatened or lost.

In today’s Federal Register, the FDA issued an advance notice of proposed rulemaking (ANPR) to request data and information on the food transportation industry and its practices, as well as data and information on the contamination of transported foods and any associated outbreaks. FDA is doing this as it begins the implementation process of the Sanitary Food Transportation Act of 2005, which requires the agency to issue regulations setting forth sanitary transportation practices to be followed by shippers, carriers by motor vehicle or rail vehicle, receivers, and others engaged in food transport. A few of the questions posed by FDA in the ANPR are:

• What are the amounts and percentages of foods that are transported completely enclosed by packaging, not completely enclosed by packaging (e.g., grain, some fresh produce items), or in bulk tanks (e.g., juices, oils)?
• What proportion of vehicles is exclusively dedicated to transporting foods? What proportion of vehicles transport both food and non-food products?
• What industry standards exist for the cleaning of food transportation vehicles?
• How is the adequacy of cleaning vehicles (including bulk vehicles and non-bulk vehicles) assessed?
• What procedures and practices are in place to prevent contamination of foods not completely enclosed by packaging during transport?
• How are the physical integrity and physical security of a food transport vehicle ensured during its run?
• What procedures and practices are in place to ensure temperature control for time/temperature control for safety foods?
• What types of food products are typically transported simultaneously?

Comments are due to FDA by August 28. We mentioned here on Field to Fork a couple of days ago that USDA just recently released a comprehensive report on the four primary modes of agricultural transportation (trucking, railroads, barges, and ocean vessels). As FDA begins collecting data for implementation for the SFTA, that new study will be a valuable asset to the agency.

Yesterday the USDA released to Congress a comprehensive report on agricultural transportation in the United States. Mandated by the 2008 farm bill, Study of Rural Transportation Issues covers the four major modes of transportation commonly used by agriculture in the United States and examines some of the major issues facing agricultural transportation including: the effect of deregulation on the rail industry, a growing gap for funding the inland waterways and highway systems, availability of containers and ocean vessel capacity, and the infrastructure that may be needed to support a projected increase in biofuel transportation.

Instead of looking at each mode of transportation separately, the report calls for federal agencies to adopt a systems approach to U.S. transportation needs. For example, in its analysis of each mode of transportation, the study states that “the service advantages of truck transportation are not as relevant with bulk commodities, however, as they are in the movement of fruits, vegetables, and other commodities that need specialized services, such as refrigeration or timely delivery.” It also states that more than 80 percent of cities and communities are served exclusively by trucks.

At first glance, this new USDA report should be very beneficial to U.S. policymakers as they develop legislative proposals that will address our nation’s transportation needs (e.g. the highway reauthorization bill). And given the Administration’s emphasis on eliminating food deserts within seven years, transportation will likely play a key role there as well.

Last week it was announced that the United States and Mexico may moving closer to resolving the issue of cross-border trucking when U.S. Transportation Secretary Ray LaHood and Mexican Transportation Secretary Juan Francisco Molinar reviewed the status of motor carrier issues of mutual importance to both nations. The officials confirmed their intent to resolve these issues as a highest priority and announced they will establish a working group to consider next steps of the cross-border trucking program. While the next meeting between President Obama and President Calderon of Mexico will be in mid May at the White House, it is likely that any progress made on the issue this year will be slow and incremental.

In the meantime, the Alliance to Keep U.S. Jobs (of which PMA is a member) continues to urge the Administration to work with Congress and our trade partners in Mexico to solve this problem, which has resulted in more than 25,000 jobs being threatened or lost as a result of the retaliatory tariffs imposed by Mexico when the cross-border trucking pilot program was terminated by Congress a year ago. The alliance continues to work to resolve this issue.

Hats off to Reps. Dennis Cardoza (D-CA) and Rick Larsen (D-WA) for their efforts to solve the Mexican trucking stalemate. As you know, the U.S. Congress stopped a cross-border trucking safety pilot project run by the U.S. Department of Transportation by eliminating funding for the project. This prompted Mexico to announce retaliatory tariffs on about $2.4 billion of U.S. manufactured and agricultural exports to Mexico, including several produce crops.

Reps. Cardoza and Larsen sent a letter (endorsed by 54 co-signers in the U.S. House of Representatives – thanks, PMA GROW members for your help in this effort) to Transportation Secretary Ray LaHood and U.S. Trade Representative Ron Kirk, calling for information on the Obama administration’s efforts to resolve the issue.

In part, the letter said: “Over the past 11 months, Administration officials have repeatedly expressed confidence that a resolution to the current dispute could be found that would fulfill our obligations to Mexico under the North American Free Trade Agreement. President Obama expressed his commitment to resolving the issue to (Mexican) President Calderon during their meeting in Guadalajara, Mexico in August, 2009. However, to date, the Administration has not shared any of the principles or the parameters of a proposed plan. Finally, in the FY2010 Consolidated Appropriations Bill, Congress chose not to continue the funding limitation for the pilot program.

“The current situation is unsustainable and untenable. Our constituents need help immediately and we implore you to work quickly to implement a solution that ensures safety and normalizes trade between the U.S. and Mexico. Please communicate your plans for a solution so that we are better able to understand the Administration’s strategy to address this matter and resolve this situation permanently. Our constituents need to move forward.”

For more information on the issue, visit the Alliance to Keep U.S. Jobs (of which PMA is a member). We continue to work to resolve this issue.

Fresh produce and floral grower-shippers who move product via passenger aircraft may face possible delays as the U.S. Transportation Security Administration moves to increase air cargo screening to 100 percent this August. Currently 50 percent screening at the piece level is in place.

These screening changes may cause significant air cargo handling delays at airlines where all screening is currently performed. This is a concern for produce and floral industry members who ship highly perishable products by passenger aircraft (especially to overseas export markets).

However, to mitigate these anticipated delays, the TSA is offering a series of Webinars and town hall meetings to educate industry about the benefits of the Certified Cargo Screening Program and how it provides businesses with options to screen cargo cost-effectively and efficiently at various points in the supply chain. Presented by Doug Brittin of the Transportation Security Administration, Webinars will be held:

• February 3 (1:00-2:00 p.m. EST)
• February 25 (1:00-2:00 p.m. EST)
• March 18 (1:00-2:00 p.m. EST)
• April 15 (1:00-2:00 p.m. EST)
• May 13 (1:00-2:00 p.m. EST)
• June 10 (1:00-2:00 p.m. EST)

You can register for a TSA Webinar here. Also on the registration page is a list of the town hall meetings if you’d like to attend one. The town halls are scheduled weekly from mid February to mid June at various cities throughout the U.S.

Recently, the Alliance to Keep U.S. Jobs (of which PMA is a member) urged President Obama to resolve a longstanding dispute with Mexico on cross-border trucking – a chronically overlooked issue that is contributing to American job losses. You may recall that, in March, prompted by political claims of safety concerns, Congress effectively eliminated a cross-border trucking safety demonstration project run by the Department of Transportation.

That action put the United States in violation of the North American Free Trade Agreement. It also prompted the Government of Mexico to announce retaliatory tariffs on about $2.4 billion of U.S. manufactured and agricultural exports to Mexico, including several produce crops. Mexico’s actions were deemed permissible by an international panel of trade experts, including representatives from the United States.

The Alliance estimates that more than 25,000 jobs are either threatened or have been lost as a result of the imposition of the retaliatory tariffs and believes that the ongoing dispute is undermining the U.S. relationship with Mexico and eliminating a valuable market for U.S. manufactured goods and agricultural products. For more information, visit the Alliance to Keep U.S. Jobs’ Web site. We continue to work to resolve this issue.

Recently Four Seasons Produce was recognized as a “Green Power Consumer” by PennFuture for its commitment to reducing energy use, conserving resources, and improving the environment. Also, in August Four Seasons’ Wabash Road distribution center earned the U.S. Environmental Protection Agency’s Energy Star for the second year in a row. Four Season’s facility is currently one of only four refrigerated warehouses in the country to have received this honor.

In measuring the ROI of their sustainability efforts, Four Seasons has found that the electric bill at its Wabash Road facility has been reduced by 25% since 2006 through improved energy management, lighting and dock shelter retrofits, and other initiatives. In addition, water usage has been reduced by 24%, and 86% of all solid waste was recycled in 2008.

Another branch of the Four Seasons’ family, Sunrise Logistics, has used dynamic routing and delivery consolidation to reduce truck travel by more than a million miles in the past year and a half. Sunrise Transport drivers have reduced inter-trip idling during the same period by 25 percent, resulting in improved fleet fuel efficiencies.

We’ve talked about other organizations’ sustainability efforts here on the blog before, and if you know an organization that has implemented sustainable or socially responsible programs, please let us know. We’re always looking to highlight industry efforts in the sustainability arena on the PMA Web site.

As you know, in March, prompted by political claims of safety concerns, Congress effectively eliminated a cross-border trucking safety demonstration project run by DOT. That action put the United States in violation of the North American Free Trade Agreement. It also prompted the Government of Mexico to announce retaliatory tariffs on about $2.4 billion of U.S. manufactured and agricultural exports to Mexico, including several produce crops. Mexico’s actions were deemed permissible by an international panel of trade experts, including representatives from the United States.

Despite pressure from industry, including PMA, this stalemate drags on.

The U.S. Department of Transportation issued a report last month: “Follow-Up Audit on the Implementation of the North American Free Trade Agreement’s Cross-Border Trucking Provisions.” That report affirms that Mexican trucks are as safe as U.S. vehicles – and that Mexican truck drivers have better safety records than their U.S. counterparts.

In addition, last May, the Congressional Research Service issued similar findings, and referred to a prior year audit performed by DOT, telling Members of Congress: “[T]he safety of Mexican trucks … is now comparable with U.S. trucks.… Recent data… indicate that other Mexican trucks are as safe as U.S. trucks and that the drivers are generally safer than U.S. drivers.”

Most recently, a U.S Chamber of Commerce study released earlier today notes that Mexican tariffs, which have only been in place for six months, are having a devastating impact on U.S. exports and causing Americans to lose their jobs as a direct result. The study concluded that the U.S. failure to implement NAFTA’s cross-border trucking provisions has resulted the loss of 25,000 U.S. jobs, $2.2 billion in higher costs for U.S. families and companies and another $2.6 billion in lost U.S. exports.

For more information on the issue, visit the Alliance to Keep U.S. Jobs (of which PMA is a member). We continue to work to resolve this issue.

To help make our industry’s voice heard on the ongoing U.S.-Mexico cross-border dispute, we have just posted a letter on the PMA Advocacy Action Center that you can send to U.S. Transportation Secretary Ray LaHood and to U.S. Trade Representative Ron Kirk. A few months ago, a provision in the FY09 omnibus spending bill halted the U.S.-Mexico trucking program, resulting in retaliatory tariffs from Mexico, including high tariffs on several fresh produce items. Despite high-level meetings between leaders of both nations, the cross-border dispute is showing few signs of progress.

The most recent Capitol Hill news on this issue is that House Foreign Affairs Trade Subcommittee Chairman Brad Sherman, D-Calif., is pressing USTR Kirk to challenge the Mexican tariffs on $2.3 billion worth of U.S. products saying that “American businesses and workers may have been unfairly harmed by inappropriate tariffs recently levied by the Mexican government. I look forward to hearing what steps the USTR is undertaking to bring relief to U.S. producers.”

You can help by writing Secretary LaHood and Ambassador Kirk via on the PMA Advocacy Action Center.