AGC Hails Signing of U.S.–Mexico Cement Agreement
Seeks to Work with All Cement Firms to Assure Adequate Supplies
The signing on Monday, March 6 by U.S. and Mexican government officials of an agreement to lower duties on Mexican cement is a good first step for contractors and consumers alike.
AGC CEO Stephen E. Sandherr shakes hands with U.S. Commerce Secretary Carlos Gutierrez at the signing that was held at the Commerce Department in Washington, D.C. on March 6, 2006.
U.S. Commerce Secretary Carlos Gutierrez responded to AGC’s concerns and worked out an agreement that sharply reduces the duty now and will eliminate it in three years. It includes a ‘safety valve’ in case more imports are urgently needed.
The next step is to increase domestic supply. AGC hopes, now that this dispute has been settled, that domestic and foreign cement producers alike will work with contractors to add capacity throughout the U.S. AGC is eager to begin removing roadblocks to the construction of cement plants and terminals.
Under this agreement, imports from Mexico are capped at 3.0 million metric tons per year for three years, and are subject to a duty of $3 per metric ton, offering significant relief over the $26 duty now in effect. The tonnage is a modest improvement over the 2.2 million metric tons that were imported from Mexico in 2005, and, most important, all limits will be removed in three years if both sides abide by the agreement. The ‘safety valve’ is a disaster provision of an additional 200,000 metric tons to be instituted if the President determines that a natural disaster warrants an increase in imports of Mexican cement.
The mild, dry weather this January meant that more cement was used than usual, making shortages even more likely than last year, when 32 states reported shortages by August. Increased ready access to more Mexican cement in some of those states will help contractors to keep working instead of having to lay off employees.”
For more detailed information on the cement shortage, visit http://www.agc.org/galleries/economics/cementshortfactsheet.doc
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