McClung said he believes the second phase of the Florida growers’ strategy is to immediately request a dumping investigation once the suspension agreement is dropped.
“Those can go on for years and years and cost a lot,” McClung said, adding that all the while the Florida growers would have the advantage of no competition from Mexican tomato growers.
That would most likely mean higher prices for U.S. consumers at the grocery store and in restaurants, he said.
The potential for retaliatory tariffs on U.S. produce is another concern.
When the U.S. failed to allow Mexican trucks to cross the border as required by the North American Free Trade Agreement, Mexico slapped tariffs of 10% to 45% on several U.S. commodities. McClung said the apple industry was hit particularly hard because Mexico is the largest export market for U.S. growers.
“Many officials feel this is an affront. It’s a matter of national pride and they feel justified in taking action,” Jungmeyer said.
In addition to pricing and tariff issues, the supporters of the 16-year-old tomato trade agreement said its termination would have a ripple effect on the U.S. economy. Victims of those effects included trucking companies and the service providers they use while transporting the loads.
“There would be less collected in fuel taxes and less money spent at restaurants and hotels along their routes,” Jungmeyer said.
Jungmeyer said the port of entry at Nogales sees about 1,200 trucks daily cross into the U.S. with fresh produce during winter months. About a third of those are full of tomatoes.
McClung said American jobs are also at stake.
“The importers who are opposing this termination are not doing so to protect Mexican jobs, they are doing it to save jobs in the U.S.,” McClung said, explaining that the importers would reduce staff if they did not have Mexican tomatoes to pack and ship.
Ultimately, the supporters of the current trade agreement said the push by the Florida growers to terminate the agreement now is unnecessary because it is scheduled to end in December anyway. At that time, the terms of the agreement would have been renegotiated.
Agreeing with Reinsch of the National Foreign Trade Council, McClung said the termination effort was launched to create an “artificial urgency because of growers in a swing state.”