On August 20th Mexican tomato growers and the United States Department of Commerce reached a new agreement regarding Mexican tomato export.
The agreement includes the proposal to inspect 92 percent of the trucks at the border to check their quality, an increase in the reference prices for specialty tomatoes and an increase in the price of organic tomatoes to get those 40 percent above the price of conventional ones.
Various industry bodies have released official responses to the news, varying from excitement to mild concern.
The Fresh Produce Association of the Americas (FPAA) were happy that a new draft agreement was produced, they expressed worry about the potential impacts of the increased border checks on traffic and potential damages to the U.S. tomato market. “At that level, the inspections are not only unnecessary, they also have the potential to destabilize the U.S. tomato market,” said Lance Jungmeyer, President of the FPAA. “U.S. importers and marketers of Mexican tomatoes will bear what amounts to punitive costs associated with such levels of inspection. Because of the sheer volume of tomatoes shipped north from Mexico to the U.S., we can expect the inspections to create substantial delays that compromise the quality, affordability and availability of tomatoes to American consumers and will create bottlenecks for other goods crossing the border.”
The United Fresh Produce Association were more optimistic. They looked to congratulate all of those involved to resolve this matter "to bring stabilization back to the tomato marketplace." They also stated that they felt this would be beneficial for the entire distribution chain, most importantly growers and consumers.
The Border Trade Alliance similarly had congratulations to offer to all those involved but were also cautious about the new inspection mandate. “While we are relieved that new duties and higher prices will not continue to be passed on to U.S. importers and consumers, we are wary of any new mandated inspection regime that could dramatically slow processing times of tomato imports at U.S. ports of entry and put freshness and quality at risk."
NatureSweet Tomatoes, a tomato grower with facilities on both sides of the border, was very happy about the new agreement. Pointing out that the new inspection requirements would not affect their tomato varieties imported from Mexico and that the new agreement would offer a relief from an "excessive" tariff of 17.56% on all fresh tomatoes imported from Mexico.
More positive reactions came from the American Farm Bureau Federation who chose to emphasize the vital importance of Mexico as a trade partner. “We are pleased and relieved to see progress with one of our largest and most important trading partners,” AFBF President Zippy Duvall said. “Mexico is a vital trading partner for American farmers and ranchers. We need this agreement and are grateful negotiators capitalized on the close relationship that exists between our two nations. We look forward to more progress on the trade front and are counting the days until the USMCA becomes law.”
The Florida Tomato Exchange released a statement commending the Commerce Department and the Mexican industry for "coming to an agreement that recognizes the need for stronger enforcement." They stated that the new provisions are necessary to "eliminate the injury being caused by unfairly traded Mexican tomatoes."
Also trade organisation Produce Marketing Association (PMA) is pleased that a new draft agreement has been reached to bring certainty to the marketplace. "Implementation will be critical to ensure the expectations of all parties are achieved and that the industry can continue to supply consumers with high-quality, year-round products at affordable prices. We look forward to seeing details of the agreement, particularly provisions that outline the level of increased inspections that will impact the supply chain."
“I want to thank my colleagues at the U.S. Department of Commerce for working diligently to reach a mutually beneficial agreement for tomato growers in both the U.S. and Mexico", said U.S. Secretary of Agriculture Sonny Perdue. "Protecting America’s tomato producers from the glut of Mexican imports is yet another example of President Trump’s commitment to ensuring our farmers have the ability to succeed in international markets, as well as right here at home. Tomato producers across America, including those in Arizona, California, the Carolinas, Florida, and Georgia will benefit from the elimination of the unfair trade practices we have seen from these Mexican tomato imports. America’s farmers are the most productive on earth and President Trump recognizes that – I thank him for his continued work to secure fair trade that benefits our nation’s producers and consumers alike. When it comes to trade and agriculture, we have a mutually dependent relationship with Mexico and reaching a compromise here allows us to refocus our efforts towards quick passage by Congress of the broader U.S.-Mexico-Canada Agreement.”
Generally, the reaction has been favorable to the new agreement, which will take effect on the 19th of September.
More information on the details of the agreement can be found here.