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Tomato Suspension Agreement

Mexican and US greenhouse growers disagree with Florida open field growers

The responses to the end of the Tomato Suspension Agreement are exemplary for a divided country. The CEA Alliance is deeply disappointed that the U.S. Department of Commerce chose to proceed with the termination of the Tomato Suspension Agreement with Mexico, despite multiple U.S. agriculture and business stakeholders urging renegotiation of the agreement. At the same time, congressman Vern Buchanan is very enthusiastic.

Voice of members
"Unfortunately, the Department failed to take into account the voice of our members in the U.S. greenhouse tomato industry, which now grows more than one-third of all U.S. fresh tomatoes," said CEA Alliance Executive Director Tom Stenzel. "When the original dumping order was issued in 1996, the greenhouse sector was just beginning to grow, offering consumers better-tasting vine-ripe tomatoes compared with field tomatoes that are picked green."

Today, greenhouse tomatoes dominate the retail supermarket sector, offering tomatoes still on the vine and a wide range of specialty tomatoes with great flavors and multiple colors. The U.S. Department of Agriculture reports that production of U.S.-grown greenhouse tomatoes increased 69% from 2010 to 2023, compared with a 49% decline in field-grown tomatoes. "U.S. consumers have voted with their dollars," Stenzel said.

"Because most high-value greenhouse growers farm in Canada, the U.S. and Mexico, the termination of this agreement will cause significant damage to these growers, serving as a financial barrier to new investment in U.S. greenhouses," he said. Unfortunately, this became a political issue that was not resolved on the facts of what would be best for American businesses and consumers."

The CEA Alliance will continue to stress the critical importance of the U.S. greenhouse tomato industry. "We remain hopeful that open-field growers will reengage in discussions that could serve all parties much more effectively than this order," he said.

On the other hand, some politicians seem to disagree. Congressman Vern Buchanan, Vice Chairman of the House Ways and Means Committee and member of the Trade Subcommittee, released the following statement after the Trump administration and U.S. Secretary of Commerce Howard Lutnick announced the termination of the 2019 U.S.-Mexico Suspension Agreement on Fresh Tomatoes from Mexico:

"Today's official termination of the failed Tomato Suspension Agreement is a major win for Florida's tomato growers and American agriculture. For too long, the Biden administration ignored our calls to end unfair Mexican trade practices. I want to thank President Trump and Secretary Lutnick for their strong leadership in supporting American farmers.

"Now, we're putting American farmers first. I recently led a letter with Senator Rick Scott and 17 colleagues urging the Department to support Florida's tomato growers by enforcing America's antidumping laws after decades of unfair Mexican trade practices, and I'm grateful that the Department delivered."

Buchanan recently led a letter with Senator Rick Scott (R-Fla.) and 17 colleagues applauding the Commerce Department's initial decision to terminate the agreement. Buchanan has championed policies that support Florida's fruit and vegetable industries and is a long-standing advocate for fair trade. He previously introduced the Defending Domestic Produce Protection Act to help Florida fruit and vegetable growers combat illegal seasonal dumping and Mexico's unfair trade practices.

Mexican government rejects the imposition
The Mexican government has rejected this imposition. On Tuesday, President Claudia Sheinbaum declared that Mexican tomatoes will continue to be exported despite the new tax, as "there is no substitute" for this product in the U.S. market. During her morning conference at the National Palace, the president said it was an "unfair" measure that would harm U.S. consumers by increasing the price of the product.

Mexican tomatoes account for 90% of tomato consumption in the United States, with an estimated export value of $2.8 billion a year. According to data from the Mexican government, nearly 4.3 billion pounds of the 6.5 billion pounds of tomatoes consumed in the United States each year come from Mexican fields.

Sheinbaum recalled that the agreement that exempted Mexican tomato exports from tariffs had already been withdrawn in 2019, and had later been reinstated in view of the U.S. market's high dependence on the Mexican product. The Mexican government said it will continue to negotiate with U.S. authorities to reverse or mitigate the new tariff.

The president also read a statement signed by the main associations of tomato producers, which stressed that, after 28 years of the previous trade agreement, the sector has managed to modernize and offer a competitive product, which has won the preference of U.S. consumers. The agricultural organizations warned that there are no viable alternatives, in the short or medium term, to replace the Mexican tomato in that market.

The Ministries of Economy and Agriculture regretted the U.S. government's decision, pointing out that several proposals have been put forward to reach an agreement with Florida producers, without success. According to both institutions, an agreement wasn't reached due to political reasons.

In addition to the tomato tariff, the Mexican government faces a possible increase in overall tariffs on exports outside the TMEC framework, as Donald Trump could raise tariffs for Mexican products from 25% to 30%. Against this backdrop, Sheinbaum's government is seeking to make progress in the negotiations and prevent the new U.S. trade policy from aggravating the effects on the export sector.