The US Department of Commerce has announced a preliminary notice of intent to terminate the suspension agreement for Mexican tomatoes sold in the US.
The move follows a request from Florida tomato growers to end the trade pact, which for the last 16 years has set a minimum price for the fruit on the US market.
The current deal will remain in force until a final decision is taken on the agreement within a period of no more than 270 days.
The announcement reportedly came one day before a scheduled meeting on 28 September during which the government agency and Mexican growers were set to renegotiate the agreement.
Mexican growers were apparently already en route to Washington DC when the news was announced.
The Fresh Produce Association of the Americas (FPAA) has denounced the decision as “hasty, unwarranted and politically motivated”.
FPAA represents a number of US-based distributors of Mexican fresh fruits and vegetables.
“Commerce today delivered a slap in the face to the goodwill showed by the Mexican growers, who were scheduled only tomorrow to have a meeting with Commerce to renegotiate terms of the agreement,” said FPAA president Lance Jungmeyer in a news statement.
“The Mexican grower groups had tried in vain for four months to schedule a face-to-face opportunity to renegotiate this agreement,” Jungmeyer added.
“The fact that Commerce chose to terminate the agreement the day before this meeting only underscores the political pressure that Commerce was facing from the industry in Florida, a key swing state in the upcoming election.”
FPAA also is dismayed by what it describes as the “lack of credence” that the US Department of Commerce gave to the nearly 350 letters it received from US interests expressing support for continuation of the agreement.
The association said groups supporting continuation of agreement were as diverse as the US Chamber of Commerce, Food Marketing Institute, National Restaurant Association, National Pork Producers Council, American Dairy Federation and American Meat Institute, among others.
“Even Walmart, the biggest retailer in the world, supported keeping the tomato suspension agreement,” Jungmeyer pointed out.
“Their promise is everyday low prices for their shoppers, and they clearly see that terminating the agreement could raise tomato prices for consumers, at the same time as reducing selection and variety in one of the top categories in the whole produce department.”
FPAA added that terminating the agreement and initiating a new anti-dumping investigation, which it claims Florida growers have said is their goal, has “enormous implications” for jobs generated by the US-based companies that import Mexican tomatoes, and the ancillary businesses that support this industry.
“Tens of thousands of jobs in border states like Arizona, Texas and California rely on the tomato-importing industry,” explained Alejandro Canelos, chairman of FPAA and director of Apache Produce, a major employer in Nogales, Arizona.
“These companies are third- and fourth-generation family operations that are the cornerstones of the local employment base.”
According to Jungmeyer, the US Department of Commerce has not historically made a decision this quickly when the deal has previously been contested.
“In this case, the decision to terminate the agreement was fiercely contested by numerous US interests who said doing so would be bad for their business,” he noted.
“Either the Administration does not care about these businesses, or it is motivated by political concerns.”
