"US (AZ): Mexican tomato price rises "far from modest"
The agreement was made after fears that the ongoing controversy over import of Mexican tomatoes could spark a trade war. It has been called "bittersweet," by Lance Jungmeyer, president of Nogales-based Fresh Produce Association of the Americas (FPAA).
"We were enthusiastic that a deal was done, but as time has allowed the details of the deal to settle in, particularly the prices, we really realized that it’s not a great deal, especially for the businesses here in Nogales," he said.
The agreement is not yet fixed in stone and will take effect until March 4th. The agreement sees the Department of Commerce holding back its plan to lift suspension of an anti-dumping investigation, but also raising the minimum price for Mexican tomatoes.
Jungmeyer said that he had heard over the months that any such rise would be modest, but he says the one proposed by the agreement is high.
"This is far from modest, this is obscene," he said of the minimum, or reference prices, established by the new deal.
During the winter months, which is the busy season for Nogales produce distributors, the $0.21 per pound reference price for tomatoes will jump to $0.31 for open field tomatoes, $0.41 for "controlled environment" tomatoes, $0.45 for specialty, loose tomatoes, and $0.59 for packed, according to a fact sheet from the International Trade Administration of the Department of Commerce.
For summer tomatoes, the reference price will increase from $0.17 per pound to $0.24 for open field, $0.32 for controlled environment, $0.35 for specialty, loose, and $0.46 for specialty, packed.
An increase in the price of tomatoes will have a large impact on local distributors, Jungmeyer said, noting that tomatoes make up 32 percent of the produce imported by the more than 100 members of the FPAA.
"This town was built on tomatoes. If you see the ability of this town to sell tomatoes drop by 10, 20, or 30 percent, you’ll see a corresponding drop in the ability of these companies to employ people," he said.
Source: insidetucsonbusiness.com