The U.S. Department of Commerce announced its withdrawal from and termination of the 2019 Agreement Suspending the Antidumping Duty Investigation on Fresh Tomatoes from Mexico on July 14, the final day of the 90-day review period.
With the termination of the agreement, the Commerce Department issued an antidumping duty order, resulting in duties of 17.09% on most imports of tomatoes from Mexico. The department said antidumping duties are calculated to measure the percentage by which Mexican tomatoes have been sold in the U.S. at unfair prices.
“Mexico remains one of our greatest allies, but for far too long our farmers have been crushed by unfair trade practices that undercut pricing on produce like tomatoes. That ends today,” Commerce Secretary Howard Lutnick said in a news release. “This rule change is in line with President Trump’s trade policies and approach with Mexico.”
Whether to extend the 90-day review period or terminate the agreement has been fiercely debated in the fresh produce industry, with those calling for its termination saying it failed to prevent Mexican exporters from dumping below-production-cost tomatoes into the U.S. market, and proponents of the agreement’s extension — like Tom Stenzel, executive director of the Controlled Environment Agriculture Alliance — saying the past five Tomato Suspension Agreements did not fail, but rather benefited American consumers.
The CEA Alliance is deeply disappointed that the Commerce Department chose to proceed with termination of the Tomato Suspension Agreement with Mexico, despite multiple U.S. agriculture and business stakeholders urging renegotiation of the agreement, Stenzel told The Packer.
“Unfortunately, the Department [of Commerce] failed to take into account the voice of our members in the U.S. greenhouse tomato industry, which now grows more than one-third of all U.S. fresh tomatoes,” he said. “When the original dumping order was issued in 1996, the greenhouse sector was just beginning to grow, offering consumers better-tasting vine-ripe tomatoes compared with field tomatoes that are picked green.”
Today, greenhouse tomatoes represent the growth in the category, says Stenzel, pointing to the USDA, which reports production of U.S.-grown greenhouse tomatoes increased 69% from 2010 to 2023, compared to a 49% decline in field-grown tomatoes.
“Because most high-value greenhouse growers farm in Canada, the U.S. and Mexico, the termination of this agreement will cause significant damage to these growers, serving as a financial barrier to new investment in U.S. greenhouses,” he said. “Unfortunately, this became a political issue that was not resolved on the facts of what would be best for American businesses and consumers.”
Stenzel says the CEA Alliance will continue to stress the “critical importance” of the U.S. greenhouse tomato industry moving forward.
“We remain hopeful that open-field growers will reengage in discussions that could serve all parties much more effectively than this order,” he said.
The Department of Commerce offered the following backgrounder on the Tomato Suspension Agreement: The domestic fresh tomatoes industry petitioned for relief on March 29, 1996, because it claimed it was being materially injured by dumped Mexican imports. Over the last 27 years, there have been five suspension agreements (1996, 2002, 2008, 2013 and 2019). The 2019 agreement was entered into under Section 734(c) of the Tariff Act of 1930, as amended, pursuant to which it must “eliminate the injurious effect of Mexican tomato imports.”
The Mexican signatories agreed to abide by the terms of the 2019 Agreement, including to sell at or above certain minimum selling prices and to eliminate at least 85% of the dumping found in the underlying investigation on each entry of tomatoes. The 2019 agreement contained a duration section (Section XI) which allows Commerce, an individual signatory or the collective signatories,to withdraw from the 2019 agreement with 90-days’ notice. Commerce and the Mexican signatories have used this provision previously to initiate a withdrawal from and termination of past suspension agreements.
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