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September 19 is the limit to issue a resolution on tomato tariffs

Mexico: "US is being very inflexible on tomato export agreement"

According to the Secretary of Economy of Mexico, Graciela Marquez, the US Department of Commerce continues to maintain its intention to review 100% of tomato shipments at the border within 72 hours, a position that she said was very inflexible regarding Mexican tomato exports to the US market.

In addition to the Mexican Government's concern about the lack of human resources that the US agencies have to process this merchandise, since May 7, 2019, Mexican tomato exporters have to pay a provisional countervailing duty of 17.5%, which must be covered as a guarantee to be able to export to the United States.

Background
In April of 1996, tomato farmers in Florida and some other US states requested the initiation of an anti-dumping investigation against Mexican tomato exports.

In November of the same year, the Department of Commerce determined in its preliminary ruling that there were margins of dumping in the investigation, but at the same time it suspended the investigation due to a price commitment between Mexican producers/exporters and the Department of Commerce itself that allowed the signing of an agreement to suspend the anti-dumping investigation.

The suspension agreement, which was renewed in 2002, 2008, and in 2013, conditions the entry of Mexican tomato into the US but has worked well for the Mexican industry, creating certainty in the commercial flows and has channeled one of the main commercial disputes between Mexico and the US.

Electoral environment
According to Graciela Marquez, the imposition of tariffs has to do with the elections in the state of Florida, since there are groups that are interested in satisfying voters.

The elimination of the Suspension Agreement implies that the Department of Commerce has reactivated the anti-dumping investigation suspended since 1996. Its final determination must be issued no later than September 19, 2019.

In turn, 45 days later the United States International Trade Commission will issue its final determination regarding the damages to the industry, which could happen around November 1, 2019.

This will lead to the definitive application of anti-dumping taxes on tomato exports to the United States or the free trade of this product between the US and Mexico.

Mexico displaced the Netherlands as the world's largest tomato exporter in 2018, with external sales of 2.261 billion dollars. But this achievement is based on its almost total dependence on the US, to whom it sends 99.7% of its exports.

 

Source: df.cl / publimetro.com.mx 


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