The United States and Mexico have struck a deal on American poultry exports, heading off a potential trade row.

Under the North American Free Trade Agreement, Mexican tariffs on US poultry exports fell to zero on1 January.

However, Mexico was concerned about a potential export boom that could have damaged Mexican poultry producers and threatened to invoke its NAFTA right to impose an emergency safeguard tariff of up to 240% on US chicken.

Under the deal, Mexico will admit 50,000 tonnes of US chicken leg quarters duty-free over the next six months and will impose safeguard tariff of 98.8% on these imports above that level. All other US poultry exports will enter Mexico duty free.