Trade Tensions Could Spike Tomato Prices for Arizona and U.S. Consumers

If a Florida group wins a trade disagreement, Arizona might soon feel the pinch in their wallets. The International Trade Administration weighs public feedback regarding the Florida group’s proposal. This group aims to end an accord regulating the import of fresh Mexican tomatoes since 2019.

So, why does this matter? Arizona could face consequences if the Biden administration opts to scrap the deal. The state heavily relies on the fresh produce sector for employment. Moreover, this move could dent consumers’ pockets, especially during soaring inflation.

Known as the Tomato Suspension Agreement, this deal isn’t new. Such pacts have been renewed every five years since 1996.

But what’s the fuss about? The Florida Tomato Exchange, speaking on behalf of Florida’s tomato growers, believes there’s unfair play. They assert that Mexican tomatoes are entering the U.S. market at prices below the minimum set in the 2019 agreement.

Conversely, importer groups, like the Fresh Produce Association of the Americas in Nogales, Arizona, disagree. The FPAA’s president, Lance Jungmeyer, stated, “The FTE’s recent move threatens the tomato variety U.S. consumers love at prices they can bear.” He added that the FTE’s actions seem like an attempt to monopolize the market.

If the agreement ends, it’s not just about tomatoes. The move could block the produce inflow, causing potential supply chain hiccups. In an already tight market, this means skyrocketing prices for tomatoes.

During past negotiations, Arizona’s congressional members highlighted the importance of the state’s trade ties with Mexico. This relationship pumps billions into the U.S. GDP and ensures employment for around 33,000 Americans.

But there’s more. Ending the agreement might provoke Mexico to slap tariffs on U.S. exports. This would increase the price of U.S. goods in Mexico.

However, the FPAA defends the 2019 agreement. They note its vigorous enforcement, including regular audits and checks. In contrast to the FTE’s claims, the Department of Commerce found Mexican tomatoes fully compliant with the agreement.

Trade Tensions Could Spike Tomato Prices for Arizona and U.S. Consumers
Trade Tensions Could Spike Tomato Prices for Arizona and U.S. Consumers

Jungmeyer points out that U.S. consumers adore the taste of fresh Mexican tomatoes. In comparison, Florida’s tomatoes undergo artificial ripening with ethylene gas. He mentioned, “Consumers clearly favor vine-ripened tomatoes over artificially ripened ones. Mexico’s vine-ripened tomatoes are in demand, which is why the FTE seeks a trade barrier.”

Lastly, it’s worth noting the stakes. The tomato import business contributes $3 billion to the U.S. GDP.

Leave a Comment