Tomato Suspension Agreement Officially Terminated

On May 7 the Tomato Suspension Agreement officially terminated. The Department of Commerce announced the U.S. withdrawal in the beginning of the year.

The agreement, made back in 2013, was designed to prevent an anti-dumping investigation in exchange for Mexican growers agreeing to certain restrictions.

Michael Schadler, executive vice president of the Florida Tomato Exchange, has been very vocal about his issues with the agreement. He has been fighting to terminate the agreement since 2018 and has continued those efforts in 2019.

Florida’s unique climate has given the state a leg up agriculturally, since growers are able to grow certain crops, like tomatoes, in the winter, but Mexican imports have been invading that market window. This increased competition has forced some Florida growers out of business.

According to a Washington Post article, from 2002 to 2017, U.S. tomato production has declined by 34 percent from 4.4 billion pounds to 2.9 billion pounds, while Mexican tomato imports to the United States increased 225 percent from 1.6 billion pounds to 3.6 billion pounds.

Schadler released the following statement on May 8, following the official termination:

We are pleased that the Commerce Department has terminated the tomato suspension agreement, which presided over a very difficult five-year period for the U.S. tomato industry.  Although the agreement was created with good intentions, it was never effective in protecting American producers from dumped Mexican tomatoes.  As a result, the U.S. industry has declined significantly over the last five years with many tomato growers across the country going out of business. 

Negotiations for a new suspension agreement can still continue even as the antidumping investigation is resumed this month.  The U.S. tomato industry remains open to a new suspension agreement so long as it is structured in a way that eliminates the loopholes of the previous agreement and has strong enforcement mechanisms.  If a new agreement cannot be reached, we look forward to the antidumping investigation finally running its full course.   

Now, anti-dumping investigations will be resumed, and a 17.5% tariff will be placed on Mexican imports.