The U.S. plans to withdraw from the 2013 Suspension Agreement on Fresh Tomatoes from Mexico, a move that allows authorities to investigate allegations that product is being dumped into the U.S. market.

“We have heard the concerns of the American tomato producing industry and are taking action today to ensure they are protected from unfair trading practices,” Secretary of Commerce Wilbur Ross said in a news release. “The Trump administration will continue to use every tool in our toolbox to ensure trade is free, fair and reciprocal.”

Once the U.S. officially withdraws from the agreement May 7, the Department of Commerce will resume its long-dormant antidumping investigation, according to the release.

If the department finds sales made at less than fair value, the International Trade Commission will conduct its own investigation. If both the Department of Commerce and the International Trade Commission come to the conclusion that harm is being done to U.S. growers by the current arrangement, an antidumping order will be issued.

The U.S. has been negotiating with Mexico on the agreement since January 2018, but the parties were unable to develop a revised agreement acceptable to both sides.

The Florida Tomato Exchange in November requested that the Department of Commerce pull out of the agreement and investigate antidumping allegations.

The Packer reached out by phone and email to the Florida Tomato Exchange for a comment Feb. 7 but did not receive a response by press time.

 

FPAA ‘disappointed’ in decision

Lance Jungmeyer, president of the Fresh Produce Association of the Americas, said in a news release that FPAA was disappointed at the news of the termination of the agreement and recommended the Department of Commerce continue to work toward a new deal.

“The tomato suspension agreement has brought stability to the U.S. tomato market for over two decades, and it has been updated as the market has evolved,” Jungmeyer said in the release. “These updates have resulted in a wide selection of fresh tomatoes for U.S. consumers, while complying with U.S. trade laws, and adding enforcement mechanisms as the agreement itself has evolved.

“Despite Florida’s rhetoric, the record has shown that both Mexican growers and U.S. distributors have complied with the rules of the agreement,” Jungmeyer said.

He contends that the interests of Florida growers extend beyond import prices.

“They are seeking to have second, third and fourth sales covered under the minimum price, including handling and freight charges,” Jungmeyer said in the release. “This is clearly outside of the scope of the law and is intended to discourage U.S. businesses from selling Mexican tomatoes.”

Jungmeyer noted the terms of the agreement remain binding on buyers and sellers until the U.S. formally withdraws in May.

 
Comments
Submitted by Produce Guy on Fri, 02/08/2019 - 06:52

So, who's going to decide what "fair market value" is???

Submitted by Produce Trader on Fri, 02/08/2019 - 12:54

Fair market value is standard trade law terminology. The Department of Commerce and International Trade Commission determine this value based on criteria such as cost of production and prices in the home market of the exporters in question. This is all handled in trade court in line with NAFTA and WTO.

In reply to by Produce Guy (not verified)

Submitted by Produce Guy on Fri, 02/08/2019 - 06:52

So, who's going to decide what "fair market value" is???

Submitted by Not a farmer on Tue, 02/12/2019 - 12:20

I spoke with a Midwest farmer, who lost his tomato-growing enterprise last year, due to end-users sourcing paste from Mexico. First Heinz did it, then others. Unfortunate, it seems, but, I'm sure it's a level playing field of environmental & labor regulations and law enforcement (drugs/cartels/bribes - Mexico), right? There's FMV and there's FMV with an asterisk.