In a news conference held at GR Fresh in McAllen, Texas, Dante Galeazzi, president and CEO of the Texas International Produce Association, Rep. Vicente Gonzalez (TX-34), and Texas Rep. Ryan Guillen urged the Department of Commerce to extend the 90-day review period of the Tomato Suspension Agreement.
The Tomato Suspension Agreement’s 90-day review period ends on Monday, July 14. Galeazzi, citing a busy spring agenda in D.C., says the Department of Commerce should use an extra 90 days for more thoughtful consideration.
“The stakes are simply too high for us to fail here,” he says. “We are urging that there be action that is sensible and that has long-lasting impacts.”
Galeazzi says a study conducted by Texas A&M University showed the Tomato Suspension Agreement generates more than $8.3 billion in economic activity.
“That means, for every $1 of tomatoes imported, the U.S. receives $2.67 of economic activity,” he says. “It’s an investment for us to continue this.”
Galeazzi says Mexican tomatoes represent 70% of the fresh tomatoes consumed in the U.S.
“So you can see why that would be very impactful if you were to suddenly cut off 70% of the supply,” he says. “Terminating this agreement will undo three decades of stability and bring about a 17% duty on all Mexican tomatoes entering this country.”
Galeazzi also says it’s time to modernize the Tomato Suspension Agreement while still in the agreement.
“Because if you withdraw, then you’ve got to restart efforts, whereas if you modernize, you’re taking the existing agreement, reviewing it, looking at it, and that’s what we believe should be happening in those 90 days,” he says. “Take the agreement and consider what has happened in the marketplace over the last five years. More importantly, what has happened over the last 30 years since this agreement came into existence in 1996?”
Guillen says maintaining the Tomato Suspension Agreement is critical for border towns, which depend on the economic activity.
“If the agreement were to be terminated, a 17.09% tariff would be reinstated, which could cost the Texas economy more than 4.5 billion in economic activity and eliminate over 30,000 jobs,” he says. “Termination would also raise prices for consumers and reduce access to fresh produce. The economic impact would hit the Rio Grande Valley particularly hard, for warehouses and freight operations thrive on tomato imports.”
Guillen says those involved in the tomato industry in the state want to avoid a crisis similar to what happened with egg prices.
“We need to continue nurturing this agreement,” he says. “We need to suspend any idea of canceling [the Tomato Suspension Agreement] this coming Monday.”
Gonzalez says the termination of this Tomato Suspension Agreement will lead to higher prices and less availability.
“If you only have 30%, those prices are going to go up as people fight for that remaining 30%; that’s what drives the increased cost,” he says. “That’s going to be not just in Texas, that’s going to be all of America. The 2 billion pounds plus that we pass through Texas is bound for grocery stores, restaurants, schools, cruise ships, everybody in the United States of America, all 50 states. We are the gateway for Mexican tomatoes, and by shutting down that gateway, we’re shutting down Americans’ access to tomatoes at affordable prices and year-round availability.”
Gonzalez says this economic impact will reach beyond tomatoes and into other commodities businesses manage.
“This could have a spillover effect with other products that are imported, that are warehoused together, that you have teams of employees that work multiple products in one facility,” he says. “You have trucks that are coming in with not only tomatoes, but other products. So there could be a spillover impact of inflation on other produce.”
Gonzalez says an additional 90 days will allow for more meaningful conversations about the future of the agreement.
“We’re just asking the administration to be more thoughtful, and let’s bring the experts in,” he says. “Let’s have a deeper conversation and make sure that whatever policy changes we enact or make will not be detrimental to the American people.”
Gonzales says maintaining the Tomato Suspension Agreement is a bipartisan issue.
“We need President Trump to act now before Monday and the Department of Commerce to act now before Monday,” he says. “Let’s not turn this into another crisis for the American people. Without a doubt, it’s going to create more inflation. We’re going to lose jobs. It’s going to be a major economic blow to the United States. It’s going to be a major economic blow to the diet of Americans. The time to act is now give it at least 90 days to let’s look at it a little further.”
And Galeazzi echoed previous statements, encouraging those in attendance and those watching the press conference online to speak up in favor of remaining in the agreement.
“Call upon the elected officials like those that are behind me to support us, to act,” he says. “Call on commerce and others to give it due diligence and time for the sake of our economy, our health, and let’s face it, our taste buds. Let’s keep the tomatoes flowing and the agreement going.”
