The US Department of Commerce recently announced a new tomato suspension agreement with Mexico. This new agreement came into effect in September 2019 and replaces the previous one which expired in 2017. The new agreement aims to address concerns raised by American tomato growers over unfair competition from Mexico.
Under the agreement, Mexico is required to increase the minimum price of tomatoes it exports to the US. The minimum price is determined by a formula that takes into account the cost of production, logistics, and other factors. This price is higher than what Mexico had been charging before the agreement was signed.
The new agreement also imposes restrictions on the type of tomatoes that Mexico can export to the US. Only round and Roma tomatoes are allowed, and they must be packed in specific types of containers. These restrictions are aimed at ensuring that the quality of Mexican tomatoes meets US standards.
The suspension agreement is a result of negotiations between the US and Mexican governments, as well as the tomato industry in both countries. The agreement is considered a win-win solution for both sides, as it allows Mexican tomato exports to continue while also addressing concerns of American tomato growers.
The previous suspension agreement had been in place since 2013 and had been extended twice, but many US tomato growers argued that it was not effective in curbing unfair competition from Mexico. They claimed that Mexican tomatoes were being sold at prices lower than the cost of production, which put American growers at a disadvantage.
The new agreement has been well-received by the US tomato industry, but some Mexican farmers have criticized it, saying that it could lead to job losses and hurt their livelihoods. However, Mexican officials have stated that the agreement is fair and that it will benefit both countries in the long run.
In conclusion, the new tomato suspension agreement between the US and Mexico is a significant development that addresses concerns of American tomato growers. The new agreement imposes higher prices and quality standards on Mexican tomato exports, while allowing Mexican farmers to continue exporting their produce to the US. The agreement is a testament to the importance of fair trade and cooperation between countries.