Despite erroneous claims by the Fresh Produce Association of the Americas (FPAA), the Florida Tomato Exchange (FTE) hasn’t proposed any changes to the Tomato Suspension Agreement. The FTE is asking the Commerce Department to enforce the agreement by rejecting the Mexican tomato industry’s efforts to rewrite a key part of the reference price provisions by using terms from the terminated 2009 and 2013 agreements.
The new reference price terms were specifically included by Commerce in the 2019 Agreement to provide for stronger enforcement. The 2019 Agreement–in conformity with the Antidumping statute–allows expenses incurred in Mexico to be included in the Reference Price but requires that expenses incurred on the U.S. side of the border be added on to the reference price. If the Mexican industry is unhappy with this language, they shouldn’t have signed the agreement in 2019. They are free to leave the agreement whenever they like.
As President Biden has said: “Strong trade enforcement is essential to making sure our trading partners live up to their commitments and that U.S. trade policy benefits American workers, manufacturers, farmers, businesses, families and communities.” The FPAA, which represents importers of Mexican tomatoes, does not want to support strong trade enforcement, but is instead advocating to rewrite the terms of an existing agreement.
Most egregiously, the FPAA is attempting to scare the produce industry into believing that the Tomato Suspension Agreement will somehow alter the meaning of “FOB” for the industry at large. This is dishonest. The Tomato Suspension Agreement only applies to imported tomatoes from Mexico and has no bearing on any other segment of the produce industry. For example, the agreement establishes reference prices (i.e., floor prices) for Mexican tomato imports. Does that mean other imported products from Mexico, or other domestically grown fresh produce, are subject to floor prices? Of course not. The agreement is a negotiated settlement to suspend an underlying dumping case against Mexican tomato imports. It only applies to Mexican tomatoes.
“The FTE is not seeking a renegotiation or change to the 2019 agreement. We simply want the language and rules to be enforced as they were written and agreed to in 2019 by the Commerce Department and the Mexican tomato industry,” said Michael Schadler, executive vice-president of the Florida Tomato Exchange. “Otherwise, this agreement will fail like all the others before it.”