By striking a tentative deal with Mexican tomato growers, ag leaders are now hoping for the completion of the United States, Mexico, Canada Agreement (USMCA), a major trade deal with the nation’s two largest trading partners.
The U.S. Department of Commerce made the announcement Aug. 21 that the domestic tomato industry will be protected from unfair trade, citing it would suspend an antidumping investigation of Mexico dumping tomatoes into the country at artificially low prices.
The proposed draft agreement would lift current preliminary duties of 17.5% against Mexican tomatoes. According to the Wall Street Journal, Mexico supplies about half of the fresh tomatoes consumed in the U.S.
Among other items, the proposed agreement sets reference prices for rounds and romas at 31-cents per pound, stem-on tomatoes at 46-cents per pound, tomatoes on the vine at 50-cents per pound and specialty packed tomatoes at 59-cents per pound.
There will be a 30-day comment period, with the agreement expected to take effect Sept. 19, 2019.
A deal with Mexico shows trade disputes can be sorted out “without resorting to tariffs and underscores the need to ratify the USMCA,” according to the American Farm Bureau Federation.
Currently, USMCA is signed by leaders of all three countries but is pending ratification by Congress, which is creating some headaches for farmers.
“We are pleased and relieved to see progress with one of our largest and most important trading partners,” AFBF President Zippy Duvall said in a statement. “Mexico is a vital trading partner for American farmers. We need this agreement and are grateful negotiators capitalized on the close relationship that exists between our two nations. We look forward to more progress on the trade front and are counting the days until the USMCA becomes law.”
Counting the days until Congressional approval of USMCA will hopefully be numbered, said John Kran, national legislative counsel for the Michigan Farm Bureau.
“The value of this agreement is more than just an economic benefit for U.S. tomato growers — it speaks volumes about the urgent need for Congressional approval of the pending USMCA agreement and the economic benefits it will bring to American agriculture,” Kran said. “More importantly, USMCA will serve as a template for additional trade agreements and send a strong message that U.S. agriculture is a contender in the global marketplace.”
U.S. Secretary of Agriculture Sonny Perdue said America’s farmers are the most productive on earth and that fair trade benefits farmers and consumers alike.
“When it comes to trade and agriculture, we have a mutually dependent relationship with Mexico and reaching a compromise here allows us to refocus our efforts towards quick passage by Congress of the broader U.S.-Mexico-Canada Agreement,” Perdue said.