On Aug. 20, the U.S. Department of Commerce made a draft agreement with Mexican tomato growers to suspend the ongoing antidumping investigation of fresh tomatoes from Mexico.
The agreement, DOC says, ensures the U.S. tomato industry will be protected from unfair trade.
“For many years, there have been disputes over the roughly $2 billion worth of tomatoes that are imported from Mexico annually. These disputes led the Department to terminate an earlier suspension agreement and continue an investigation that could have led to duties of 25 percent for most Mexican tomato producers. After intensive discussions with all parties, we initialed a new draft suspension agreement with the Mexican growers late last night. This draft agreement meets the needs of both sides and avoids the need for antidumping duties,” said Secretary of Commerce Wilbur Ross in an Aug. 21 statement.
The Florida Tomato Committee commended the agreement in an Aug. 21 statement saying, “The domestic tomato industry commends the Commerce Department and the Mexican industry for coming to an agreement that recognizes the need for stronger enforcement. We are committed to working hard with the Commerce Department to make sure the new agreement works.”
The draft agreement has enforcement provisions to eliminate “the injurious effects of Mexican tomatoes, as well as price suppression and undercutting,” the DOC says.
The agreement sets reference prices for:
- Rounds and romas at $0.31/lb.
- Stem-on tomatoes at $0.46/lb.
- Tomatoes on the vine at $0.50/lb.
- Specialty loose tomatoes at $0.49/lb.
- Specialty packed tomatoes at $0.59/lb.
- Organic tomatoes priced 40 percent higher than non-organics.
The draft agreement also closes loopholes from past suspension agreements that permitted sales below the reference prices and includes a new inspection mechanism to prevent the importation of low-quality, poor-condition tomatoes from Mexico, which can have price suppressive effects in the market.
Under the agreement, DOC can audit up to 80 Mexican tomato producers per quarter, or more with good cause. The statute requires a 30-day notice period after today’s initialing of the draft agreement. At that point, on September 19, Commerce and the Mexican growers could sign a final agreement. If this occurs, Commerce will suspend the ongoing AD investigation without issuing a final determination.