Tomato prices likely to increase as ‘tomato tax’ on Mexico takes effect

Versión en español

Nogales, Arizona – Following a 90-day warning, the U.S. imposed a 17.09% import tax on Mexican tomatoes on Monday after withdrawing from a 2019 trade agreement that exempted the imported product from the tax.

Scaling back from the Tomato Suspension Agreement between the United States and Mexico has sparked reactions from experts, who predict a 10% price increase for the vegetable in the U.S., which will be passed on to consumers. This has also drawn responses from Mexican producers and the Mexican federal government.

The Department of Commerce's announcement on April 14 indicated that the U.S. would withdraw from the agreement after receiving complaints from U.S. tomato producers who claimed they were not protected from unfairly priced Mexican imports.

The Florida Tomato Exchange Association applauded the Trump administration's actions on Monday, saying that the "decision will protect hardworking American tomato growers from unfair Mexican trading practices and send a strong signal that the Trump Administration is committed to ensuring fair markets for American agriculture," the statement reads.

On Tuesday morning, Mexican President Claudia Sheinbaum Pardo stated that she disagreed with the U.S.’s withdrawal and hopes to announce a series of actions next week that will be developed in collaboration with trade associations and agricultural producers.

According to the World Bank, in 2023, the U.S. imported more than two million tons of tomatoes from Mexico, valued at $2.8 billion, positioning Mexico as the leading country supplying the product to Americans.

Between 2015 and the present, approximately 90-93% of the tomatoes imported by the United States have been from Mexico, according to Georgina Felix, Director of Operations and International Affairs for the Fresh Produce Association of the Americas (FPAA), based in Nogales, Arizona.

She also said that the value of tomato sales in general is estimated at $7.33 billion, and it is estimated that tomatoes imported from Mexico generate an economic impact of $3.64 billion.

According to Felix, the department’s decision could lead to a decrease in tomato volume, which could be reflected in a shortage, a spike in cost of the produce and a disruption of tens of thousands of jobs in the U.S. alone.

This is not the first time that Mexican tomatoes have been at the center of trade disputes. For more than two decades, U.S. producers, particularly in Florida, have accused Mexican producers of engaging in unfair trade practices, which have led to negotiations and temporary agreements.

Sheinbaum addressed the issue during her Tuesday morning press conference, stating that the 2019 agreement was put in place because it has proven effective. “It's an existing agreement, one that was already attempted to be withdrawn; it was withdrawn and had to be reintroduced due to the impact it has on the economy and consumers in the United States,” the Mexican leader said.

The Mexican Association of Protected Horticulture (AMHPAC) issued a statement emphasizing the significance of Mexican producers in supplying tomatoes to the U.S.: “In the short or medium term, there are no countries in the world that can replace Mexican tomatoes in a market that we have built through innovation and effort over the last 120 years.”

The statement, signed by Germán José Gándara Fernández, president of the association, and José María Pablos, president of the Confederación de Asociaciones Agrícolas del Estado de Sinaloa, also warns that the withdrawal will inevitably impact the U.S. consumers’ pockets.

Sheinbaum added that Mexican tomato exports will continue regardless and hopes to announce a series of actions next week. She added that a roundtable discussion will continue until August 1, and they hope to reach an agreement.