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U.S., Mexican Tomato Growers Reach Suspension Agreement
USAgNet - 08/22/2019

The United States and Mexico have settled a bitter trade dispute over tomatoes, with the United States shelving an anti-dumping investigation against Mexican growers and withdrawing from tariffs that could have led to shortages and significantly higher prices.

“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 " Secretary of Commerce Wilbur Ross said in a statement. “This draft agreement meets the needs of both sides and avoids the need for antidumping duties.”

According to the Washington Post, under the buzzer-beater agreement, reached just before a Wednesday deadline, 66 percent of imported Mexican tomatoes will be subject to inspection before crossing the border. It also dictates that Mexican growers raise the reference price of specialty tomatoes, and charge 40 percent more for organic tomatoes than conventional ones.

“This result is good news because it will allow the market to be kept open for our tomato exports to the United States," Mexican Economy Minister Graciela Márquez tweeted Wednesday.

In early February, the U.S. Commerce Department announced it would be pulling out of the Tomato Suspension Agreement — which has set the parameters of the two nations’ tomato trade since 1996 — in part because of pressure from Florida lawmakers and the Florida Tomato Exchange, a U.S. trade organization, which alleged that Mexican growers were exploiting the agreement to dump cheap tomatoes into the United States and undermine American farms, the Post reported.

The termination of that pact called for a 17.5 percent tariff on imported Mexican tomatoes, which make up more than half of the U.S. tomato market. An April study from economists at Arizona State University predicted that the collapse of the agreement would leave Americans to pay 40 to 85 percent more for tomatoes by winter.

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