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Department of Commerce Announces Suspension of Mexican Anti-Dumping Investigation

Department of Commerce Announces Suspension of Mexican Anti-Dumping Investigation

U.S. & MEXICO - Earlier today, just minutes before midnight, the group of organizations representing the Mexican tomato industry reached an agreement with the U.S. Department of Commerce to suspend the anti-dumping investigation reactivated on May 7, 2019, an agreement that had been in force since 1996.

Dante Galeazzi, President and CEO, Texas International Produce Association (TIPA)“This was an extraordinary effort on the part of many entities and TIPA is pleased to see an outcome which permits Mexican tomatoes back into the U.S. without duties, thus permitting a steady flow of high-quality, flavorful product year-round for the benefit of the American consumers,” Dante Galeazzi, President and CEO of the Texas International Produce Association, shared with ANUK upon the break of the news.

The Mexico growers also put out their own statement, asserting: “An extraordinary effort was made to achieve this new agreement and it was not easy, given the political environment and the enormous opposition by Florida’s producers. With today’s signature, Commerce will start a 30-day public comment period. The new agreement will enter into force on September 19, suspending the final determination of the Department of Commerce and importers will be entitled to reimbursement of cash deposits made from May 7 to that date. More information will be provided in the coming days from each of the associations.”

According to the Wall Street Journal, duties will be removed from U.S. imports of Mexican tomatoes in exchange for Mexico raising prices and submitting to inspections.

Wilbur Ross, Secretary of Commerce“This draft agreement meets the needs of both sides and avoids the need for antidumping duties,” Commerce Secretary Wilbur Ross said.

The agreement includes inspections for quality of 92 percent of the truckloads of Mexican tomatoes entering the U.S. Reuters stated the draft agreement mentions setting minimum prices for tomatoes and “closes loopholes from past suspension agreements that permitted sales below” those prices.

While there is a sigh of relief at the consensus, some of the terms still raised concerns according to the Fresh Produce Association of the Americas.

Lance Jungmeyer, President, Fresh Produce Association of the Americas“At that level, the inspections are not only unnecessary, they also have the potential to destabilize the U.S. tomato market,” said Lance Jungmeyer, President of the FPAA. “U.S. importers and marketers of Mexican tomatoes will bear what amounts to punitive costs associated with such levels of inspection. Because of the sheer volume of tomatoes shipped north from Mexico to the U.S., we can expect the inspections to create substantial delays that compromise the quality, affordability, and availability of tomatoes to American consumers and will create bottlenecks for other goods crossing the border.”

According to Jungmeyer, “the inspection provision is essentially a non-tariff trade barrier whose ripple effects will not only damage the U.S. tomato market but many other industries that trade with Mexico.”

The group of organizations representing the Mexican tomato industry reached an agreement with the Department of Commerce to suspend the anti-dumping investigation reactivated on May 7, 2019

The Agreement will be reviewed in a mandatory manner in the following Sunset Review in September 2024.

Mario Robles, Director, CAADES“The tomato industry in Mexico thanks all the national and international actors who supported this negotiation process for almost two years, as well as the Government of Mexico, our embassy in Washington, and the members of the Senate and Congress who joined this cause in both countries,” said Mario Robles, Director of the Confederation of Agricultural Associations of the State of Sinaloa (CAADES).

The United Fresh Produce Association also released a statement in regards to the new agreement.

“The details of the agreement have yet to be announced, but United Fresh would like to congratulate all of those involved to resolve this matter to bring stabilization back to the tomato marketplace. This will be beneficial for the entire distribution chain, most importantly growers and consumers,” the association said.

In addition to United Fresh's statement, Produce Marketing Association released the following:

"PMA is pleased that a new draft agreement has been reached to bring certainty to the marketplace. Implementation will be critical to ensure the expectations of all parties are achieved and that the industry can continue to supply consumers with high-quality, year-round products at affordable prices," it stated. "PMA looks forward to seeing details of the agreement, particularly provisions that outline the level of increased inspections that will impact the supply chain."

Florida Tomato Exchange released a statement in regards to the latest announcement as well, saying: "The domestic tomato industry commends the Commerce Department and the Mexican industry for coming to an agreement that recognizes the need for stronger enforcement and are committed to working hard with the Commerce Department to make sure the new agreement works. The Mexican industry conceded on core provisions such as border inspections of all Mexican round, Roma, and bulk grape tomatoes, and improved compliance and monitoring tools."

“The entire Commerce Department negotiating team, under the leadership of Under Secretary Gilbert Kaplan, Assistant Secretary Jeffrey Kessler, and Deputy Assistant Secretary Lee Smith, did a great job in making this new agreement possible. We look forward to this agreement being implemented in 30 days from now,” the Florida Tomato Exchange continued in its statement.

For Mexico's full statement click here, for the English translation click here, and for more developments keep reading ANUK.