An agreement-in-principle has been announced by theUnited States and Mexico to settle a 16-year dispute on anti-dumping duties on Mexican cement imports, and the president of the National Association of Home Builders said that it will lead to free trade of this vital commodity and help to alleviate shortages reported in more than 30 states.
“With U.S. capacity running at full tilt, the nation still must import more than 20 percent of its cement supply in order to meet domestic needs,” said David Pressly, president of the National Association of Home Builders and a home builder from Statesville, N.C. “Once finalized, this agreement will provide additional supplies of Mexican cement to the U.S. market. The pact is vital to meet consumer demand, which is expected to increase in the coming year as the rebuilding efforts from Hurricanes Katrina and Wilma get into full swing.”
Under the proposed settlement, which is scheduled to go into effect this spring, the U.S. will reduce duties on Mexican cement to $3 per ton from $26 a ton, and Mexican imports would be permitted to grow to 3 million metric tons annually, up from last year’s level of approximately of 2 million tons. After three years, the quotas and duties would be entirely eliminated.
During the past year, NAHB has held several discussions with Commerce Department officials — including Secretary Carlos Gutierrez — urging the Administration to overturn the costly tariffs and outlining how cement shortages have led to construction delays and harmed housing affordability by increasing the cost of building projects. Data was also provided on states and geographic areas that have been most affected by the shortages.
“We are pleased that Commerce Secretary Gutierrez heeded our concerns, and showed a willingness to work with our industry and consider the needs of American consumers,” said Pressly.
The accord is structured so that Florida and the Gulf region, areas facing shortages of this vital building material, will be able to significantly increase their shipments of Mexican cement. The negotiated framework also provides the flexibility to allow the President to direct an additional 200,000 metric tons of cement to areas hit by natural disasters.
High anti-dumping tariffs that have been in place since 1990 have limited supply from Mexico, which has excess capacity. Because of its close proximity to the U.S., it takes only four days to import cement from Mexico, compared with 40 days from Asia.