Auburn agricultural economist comments on tomato tariff and trade negotiations with Mexico
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Max Runge, an agricultural economist with Auburn University’s College of Agriculture and the Alabama Cooperative Extension System, comments on the U.S. Commerce Department’s 17.5 percent tariff on tomatoes from Mexico and the negotiations to reinstate a trade agreement. Runge is the leader of Alabama Extension’s Farm and Agribusiness Management program.
What is the history and current state of the U.S.-Mexico tomato trade dispute?
The U.S.-Mexico tomato trade dispute is an ongoing trade battle that dates back to 1996. The U.S. initiated an antidumping duty investigation in 1996 into whether tomatoes from Mexico are being, or likely to be, sold at less than fair value. There have been numerous agreements between the U.S. and Mexico to suspend this investigation, with the current situation being the latest disagreement. While there is no guarantee that a mutual agreement will be reached, negotiations are ongoing according to the Commerce Department.
While it is not possible to rule out a price increase for tomatoes and tomato products, I don’t see any substantial price increases unless negotiations between the U.S. and Mexico completely break down.
The U.S. trade situation is dynamic to say the least. There are new headlines, tweets, new and rescheduled meetings and canceled orders several times a week.
Facts about U.S. tomato production and imports:
California and Florida account for about 70 percent of the fresh tomatoes produced in the U.S. with California producing about 96 percent of the tomatoes used for processing.
In Alabama, Blount and St. Clair counties are the largest tomatoes producers.
Mexico is the number one supplier of tomatoes to the U.S., supplying 91 percent of the imported volume into the U.S., followed by Canada.
Friendly neighbors:
In 2018, Canada and Mexico were the U.S. numbers one and two customers for agricultural exports.
There are many agricultural products that are traded between our neighbors and it is mutually beneficial to have trade agreements in place as soon as possible.
Interviews:
To arrange an interview with Max Runge, please contact Preston Sparks, Auburn University director of communications, at 334-844-9999 or preston.sparks@auburn.edu.
Max Runge is an agricultural economist with Auburn’s College of Agriculture and the Alabama Cooperative Extension System.
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