US business representatives involved in the multi-billion dollar cross-border trade with Mexico are set to meet with Washington DC officials this week in an effort to urge the Obama administration not to end a 16-year-old tomato trade agreement between the two nations.
The scheduling of the meeting comes in response to the US Department of Commerce’s preliminary notice of intent to terminate the so-called tomato suspension agreement following a request by Florida tomato growers.
As of 27 September, when the announcement was made, the department has 270 days to make its final decision.
However, during a media teleconference on 2 October, US fresh produce representatives claimed the department does not have the required backing of 85 per cent of the Florida tomato industry in order to end the agreement.
“The Obama administration is putting billions of dollars in US trade and jobs at risk with this decision,” Lance Jungmeyer, president of the Fresh Produce Association of the Americas (FPAA), said in a press statement.
“The FPAA is dismayed that the Commerce Department apparently disregarded the nearly 350 letters of support it received for this successful agreement from businesses as diverse as beef, poultry and dairy farmers, the US Chamber of Commerce and the National Restaurant Association.”
FPAA claims the trade pact has kept the prices of Mexican and American tomatoes on a “fair footing” in the marketplace by setting guidelines for Mexican tomato prices.
The organisation also believes that Florida tomato growers are using the state’s clout during the US presidential election year – Florida is a critical presidential swing state – to push for the termination of the tomato pact.
“This is being rushed through trying to take advantage of election time tables while there are facts still in dispute,” stated Bill Reinsch, president of the National Foreign Trade Council.
US businesses that export agricultural, manufacturing and other products to Mexico fear that ending the tomato agreement could prompt Mexico to strike back against a wide range of American goods, FPAA noted.
Mexico and the US trade more than US$1bn-worth of goods every day and US$397bn a year, according to Patrick Kilbride of the US Chamber of Commerce.
In addition, a Chamber of Commerce study has indicated that trade between the two countries has added 1.7bn jobs to the US economy.
“These are American jobs and these are American dollars at risk here,” explained John McClung, president of the Texas International Produce Association.
“This is a far broader issue than tomatoes. We are very worried that Mexico could take action against many American exports.”
FPAA’s Jungmeyer pointed out that even Walmart, the world’s biggest retailer, is in support of keeping the tomato agreement.
“Termination of the tomatoes agreement will benefit no one and will lead only to uncertainty and unpredictability in the market,” Walmart officials said in a letter to the US Department of Commerce.
Jungmeyer added that US restaurant chains such as Taco Bell could suffer major disruptions to the quality and variety of tomatoes they serve if the pact comes to an end.
Two-thirds of the tomatoes Taco Bell uses in its US restaurants are imported from Mexico, according to FPAA.
