The United States and Mexico have reached a tentative agreement on cross-border trade in tomatoes, narrowly averting a trade war that threatened to engulf a broad swath of U.S. businesses.
The agreement, reached Feb. 2, raises the minimum price at which Mexican tomatoes can be sold in the U.S., aims to strengthen compliance and enforcement and increases the types of tomatoes governed by the bilateral pact to four from one.
"The draft agreement raises reference prices substantially, in some cases more than double the current reference price for certain products, and accounts for changes that have occurred in the tomato market since the signing of the original agreement," Francisco Sanchez, undersecretary of commerce for international trade, said in a statement.
The agreement will be open for public comment until Feb. 11. The Commerce Department estimated it would take effect March 4.
Estimates are that nearly one of every two tomatoes eaten in the U.S. comes from Mexico.
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Last fall, Florida tomato growers asked the Commerce Department to end a 16-year-old agreement that had suspended an antidumping investigation that began in the mid-1990s. The agreement had been amended several times over the years, but Florida growers contended it set the minimum price of Mexican tomatoes so low they could not compete.
US growers weigh in
The Florida growers said the new agreement addressed their three main concerns: pricing of Mexican tomatoes, the number of growers covered and enforcement.
"We believe that the Department of Commerce and Mexico have struck a deal that meets those three tests, and we're hopeful and optimistic that we'll be able to compete under fair trade conditions," Edward Beckman, president of Certified Greenhouse Farmers, said in a statement. "Much work remains to have the agreement fully and faithfully implemented and continuous monitoring and enforcement will be critical."
The new agreement covers all fresh and chilled tomatoes, excluding those fruits intended for use in processing such as canning, dehydrating and juices, sauces and purees.
It raises the basic floor price for winter tomatoes to 31 cents a pound from 21.69 cents a pound, higher than the price the Mexicans were proposing in October, establishing even higher prices for specialty tomatoes and tomatoes grown in controlled environments.
The Mexican and U.S. governments both will implement mechanisms to increase enforcement of the new agreement.
