The growth of the Mexican greenhouse vegetable industry has been good not only for Mexico, but for the U.S., as well, Viramontes said. An AMHPAC study found that in 2009 alone, the industry accounted for 8,000 new jobs in the U.S.
In mid-January, Mexican tomatoes were already selling at the lowest price allowed under the suspension agreement, about 21 cents per pound, DiMare said.
That was before peak volumes from south of the border even started to hit, he said. When they do, product will come into the U.S. that is below the suspension agreement floor price.
In addition, product marked “not for export” also will make it across, DiMare said.
“The U.S. Department of Agriculture is supposed to be monitoring it, but it seems like every year that kind of product finds its way into the market,” he said.
Mexican field-grown tomato volumes have fallen off in recent years, but greenhouse volumes have skyrocketed, according to the U.S. Department of Agriculture.
In the 2005-06 season, about 343 million pounds of greenhouse tomatoes were shipped from Mexico to the U.S. By 2010-11, the total had risen to 771 million pounds.
Brown compared the suspension agreement to a dike. If the water keeps rising, there’s a point at which the dike can no longer do its job. And that point has been reached in the tomato industry.
“The marketplace is grossly oversupplied with capacity,” Brown said. “One answer is to find a mechanism at the border to avoid overwhelming the marketplace.”
Even if Mexican shippers don’t dip below the floor price established by the suspension agreement, Brown says the floor price isn’t high enough for anyone — definitely in the U.S., and probably in Mexico, too — to make a profit.
Lance Jungmeyer, president of the Nogales, Ariz.-based Fresh Produce Association of the Americas, which conducts workshops educating growers and importers about the suspension agreement, said it has succeeded in bringing order to the marketing of Mexican tomatoes.
“Everyone I talk to says it’s good,” Jungmeyer said.
Any violations of the agreement are an anomaly, he said. Shippers don’t stand to gain from dumping fruit, and under the agreement they face stiff fines if they do.
“Anyone who’s in it for the long haul has no interest in subverting this,” he said.
As for changing the agreement to limit volumes, Jungmeyer doubts if such a change would stand up to North American Free Trade Agreement and World Trade Organization scrutiny.