In a significant development, the US government said it imposed a 17 per cent duty on most fresh Mexican tomatoes after negotiations ended without an agreement to avert the tariff. Proponents said the import tax will help rebuild the shrinking US tomato industry and ensure that produce eaten in the US is also grown there.
Mexico supplies 70% of US tomato market
Mexico currently supplies around 70 per cent of the US tomato market, up from 30 per cent two decades ago, according to the Florida Tomato Exchange.
Robert Guenther, the trade group's executive vice president, said the duty was "an enormous victory for American tomato farmers and American agriculture". But opponents said the import tax will make tomatoes more expensive for US consumers.
US govt looking for ways to suspend tariff
Mexico's Economic Secretary Marcelo Ebrard said the government would continue looking for a way to once again suspend the tariff, part of ongoing negotiations between the two trading partners. In a statement Monday, he wrote that the move would "only affect the pockets of American consumers".
"It's unfair and against not only Mexican producers, but on the American industry. The ground that Mexican fresh tomatoes has gained in the US is because of the quality of the product, not from unfair practices," he wrote.
Mexican greenhouses specialise in vine-ripened tomatoes, while Florida tomatoes are typically grown in fields and picked green.
US retail prices for tomatoes likely rise by 8.5%
Tim Richards, a professor at the Morrison School of Agribusiness at Arizona State University, said US retail prices for tomatoes will likely rise around 8.5 per cent with a 17 per cent duty.
Jacob Jensen, a trade policy analyst at the American Action Forum, a right-leaning policy institute, said areas with a higher reliance on Mexican tomatoes could see price increases close to 10 per cent, since it will be more difficult to replace that supply, while other parts of the US could see price increases closer to 6 per cent.
(With inputs from AP)
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