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Fifth Annual North American Agrifood Market Integration Consortium Workshop New Generation of NAFTA Standards. OPTIONS FOR REDUCING CONGESTION AT THE MEXICAN BORDER. Juan Carlos Villa Texas Transportation Institute Texas A & M University System. Agenda. Background

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Presentation Transcript
slide1
Fifth Annual North American Agrifood Market Integration Consortium Workshop

New Generation of NAFTA Standards

OPTIONS FOR REDUCING CONGESTION AT THE MEXICAN BORDER

Juan Carlos Villa

Texas Transportation Institute

Texas A & M University System

agenda
Agenda
  • Background
  • Commercial Vehicle Border Crossing Process
  • Agricultural Truck Movement Process
  • Opportunities and Recommendations
  • Concluding Remarks
background
Background
  • Land Trade between U.S. and Mexico has tripled from $86 billion in 1994 to $262 billion in 2006
  • Two very different phases

Source: Bureau of Transportation Statistics, Transborder Surface Freight Data

background4
Background
  • Mexican exports of agricultural products -10% AAGR
  • Seasonality
  • Tomatoes - largest horticultural export

Source: USDA, Foreign Agricultural Trade of the United States Database.

Source: Servicio de Información Agroalimentaria y Pesquera-SAGARPA, Mexico.

background5
Background
  • Mexican vegetable exports are primarily done by truck
  • Concentration
    • Production
    • Ports of entry

Source: Servicio de Información Agroalimentaria y Pesquera-SAGARPA, Mexico.

Source: USDA, Foreign Agricultural Trade of the United States Database.

background6
Background
  • Elements for a potential storm
    • High growth in US/MX trade
    • Infrastructure not keeping pace
    • Concentration
      • Transportation mode
      • Ports of entry
commercial vehicle border crossing process
Unions, non-profit organizations and trucking associations. challenge legally the lift of the moratorium because of environmental reasons. Court of Appeals halts operations

E

V

E

N

T

S

The Mexican government contests the U.S. action before an international arbitration panel

U.S. Administration vows to comply with the arbitration’s panel conclusion, and includes 22 safety requirements in the Transportation Appropriations Act

USDOT and Mexico announce one-year Pilot Program

U.S. upholds the moratorium on direct long-haul trucking from Mexico

Supreme Court overturns Court of Appeals decision, Mexican carriers to apply for operating authority

The panel rules that U.S. could not under the NAFTA impose a blanket ban on the operation of trucks beyond the commercial zones

Demonstration Program

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

ORIGINAL

PLAN

Movement throughout U.S. and Mexican border states was to be allowed

Movement throughout the United States was to be allowed

Commercial Vehicle Border Crossing Process

US/Mexico NAFTA Trucking Provisions

commercial vehicle border crossing process8
Commercial Vehicle Border Crossing Process

Drayage

Nogales

Nogales

Culiacan

Chicago

commercial vehicle border crossing process9
2. U.S. Federal

2. U.S. Federal

3. State Safety

3. State Safety

1. Mexican Export Lot

1. Mexican Export Lot

Compound

Compound

Inspection Facility

Inspection Facility

Mexican export

Mexican export

CBP primary

Visual vehicle

Visual vehicle

documentation

documentation

Warehouse

inspection

Warehouse

Warehouse

CBP primary

verification and

verification and

safety

safety

/ Yard

/ Yard

(document

/ Yard

/ Yard

inspection

cargo inspection

cargo inspection

inspection)

inspection

inspection

selection

selection

Secondary

Secondary

Mexican

inspection

Mexican

inspection

Detailed state

Detailed state

export

export

VACIS, X

VACIS, X

-

-

truck safety

truck safety

cargo

cargo

Ray,

Ray, FMCSA

Others

inspection

inspection

inspection

inspection

Others

Mexico

Mexico

U.S.A.

U.S.A.

Commercial Vehicle Border Crossing Process

At least 3 potential inspections

commercial vehicle border crossing process10
Commercial Vehicle Border Crossing Process

Border Security Programs

Free and Secure Trade

FAST

Segregation of Vehicles based on previously obtained information

C-TPAT

agricultural truck movement process
Agricultural Truck Movement Process
  • Agricultural exports have additional steps
agricultural truck movement process12
Agricultural Truck Movement Process

Military Roadside Inspections

  • At least in 3 inspection points before reaching Nogales
  • Delays could double the transit time
  • Inspections performed by military personnel
    • Contamination
    • Seal breaking
agricultural truck movement process13
Agricultural Truck Movement Process

Quality Inspections

  • Some products require mandatory quality inspection by USDA officials
    • Tomatoes
    • Grapes
    • Onions
    • oranges
agricultural truck movement process14
Agricultural Truck Movement Process

Driver and Cross Docking

  • Cruzadores – Drivers
    • Require U.S. issued visas
  • Truck reload to comply with US truck weight
opportunities and recommendations
Opportunities and Recommendations
  • Number of Inspections
    • “Stops” delay shipments, increase chances for contamination and hamper security programs
  • Recommendations
    • Increase coordination
      • U.S.-Mexico
      • Fed-State
      • Public-Private
    • Coordination Areas
      • Procedures
      • Hours of operation
      • Sharing data
opportunities and recommendations16
Opportunities and Recommendations
  • FAST/C-TPAT Participation
    • Low participation
    • Underutilized infrastructure
    • Increase delays
  • Recommendation
    • Modify FAST to accommodate particular requirements of the agricultural products supply chain
    • Work with CBP/Aduanas/SAGARPA developing a pilot project
opportunities and recommendations17
Opportunities and Recommendations
  • Lack of Capacity
    • Physical Capacity
    • Human Capacity
  • Recommendations
    • Promote development of compliant carriers (truckers)
    • Sufficient drivers that can cross into the U.S.
    • Training programs (vehicle safety, security requirements)
    • Increase throughput modifying hours of operation during peak seasons, smoothing demand curve
    • Add FAST traffic lanes at crossings all the way to Mexico
slide18
Opportunities and Recommendations
  • Inefficient Procedures within Mexico
    • Military inspections
    • Security procedures at origin
  • Recommendations
    • SENASICA to define non-intrusive inspection protocols and train inspectors
    • Work with CBP to C-TPAT certify producers
    • Create a “seal” protocol from origin
slide19
Concluding Remarks
  • Identify low hanging fruit
  • Institutional framework already exists
  • Key stakeholders need to participate
gracias thank you
GraciasThank you

Juan Carlos Villa

Manager Economics, Trade and

Logistics Program

Texas Transportation Institute

979-862-3382

[email protected]

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