Florida's tomato trade threats 'dangerous' for U.S., Mexican economies

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Florida's tomato trade threats 'dangerous' for U.S., Mexican economies

Mexican tomato industry proponents recently issued a public statement condemning the acts of their Florida counterparts to try and derail a bilateral trade agreement. Florida's growers have cried foul over unfair pricing but Mexican producers say they have simply become more efficient, through substantial investment in greenhouses and growing practices that foster better flavor. At www.freshfruitportal.com we catch up with representatives of the Fresh Produce Association of the Americas (FPAA) and the Mexican Protected Horticulture Association (AMHPAC), who urge Florida's farmers to focus on more pressing issues rather than taking damaging swipes at their competitors.

In a scenario where Florida's tomato industry gets its way in the dispute, FPAA president Lance Jungmayer says it would have a big impact on consumer choice for tomatoes.

"From that we would see a reduced consumer selection of tomatoes and therefore fewer tomatoes being bought; the effect of that would be the undoing of one of the brightest categories in fresh produce today," he tells www.freshfruitportal.com.

AMHPAC director general Eric Viramontes adds a lot of retailers and distributors now recognize the quality of Florida's tomatoes is not close to the quality of the Mexican product anymore.

"It's not that we want the Florida growers to be out of business, it’s not that it’s a war between the Mexican and Florida growers, but that we have another perspective," he says.

"I believe Florida is not doing a good job in being competitive. It’s not doing a good job in becoming more efficient and being able to deliver a high quality product at an accessible price to the consumer.

"With or without Mexico, if they want to continue to be tomato growers, they’re going to have to change, because they cannot make the consumer pay for their inefficiency, or make the consumer eat a product that's not of the quality they have come to demand."

Picked red or picked green

Jungmayer says a large part of the quality issue comes down to the harvesting methods of the two different industries.

"The lion’s share of Florida’s tomatoes are picked green when it looks like an apple, hard as a rock, so that they can travel longer distances and have a better shelf life," he says.

"Then they are sent to destination markets where they are put in tomato ripening rooms, using ethylene gas to turn the tomatoes red.

"Most of Mexico’s production is ripened on the vine, picked either ripening or fully-ripened."

He highlights that when the tomato is ripening on the vine it is still developing its flavor.

"What Florida's growers are doing is picking tomatoes before they’ve developed their flavor, whereas the bulk of Mexico's tomatoes are picked ripened and have better flavor, better aroma."

Jobs, jobs, jobs

Jungmayer highlights that a value of US$816 million freight on board (FOB) was registered for the trade of Mexican tomatoes in Nogales, Arizona in 2011.

"This represents 20-25% of the value of all produce brought into Nogales, so it’s a huge amount and what Florida is trying to do would essentially harm that business in a major way, and might harm it to the point where business is cut in half or worse," he says.

"I think what the industry doesn’t fully understand is that just creates opportunities for others in foreign countries; tomato exporters from elsewhere would still be able to sell at a price that is lower than what Mexico sells now. This is essentially a shot at Mexico, their largest competitor.

"We might see more tomatoes coming in from Honduras, more tomatoes coming in from Canada, so that in going after Mexico - that is just one portion of the tomato marketplace - it’s a short-sighted move by Florida, and I believe it’s dangerous for the economy, not only in Mexico but in the United States, as there are so many jobs that rely on that business here."

He says informal studies suggest 12,000 jobs in the Nogales area come from produce, which means around 3,000 of these jobs are related to the Mexican tomato trade.

The response to this could be that Florida's growers are also potentially losing jobs to tough Mexican competiton. For Jungmayer that issue is not so clear cut.

"I would say Florida is a majority employer of seasonal agricultural labor, and probably with a large amount of undocumented workers, whereas in Nogales our workers are U.S. citizens.

For Viramontes the issue of job creation and retention goes further still.

"We are probably generating 350,000 jobs in Mexico and the U.S.; we can't forget the distribution chain in the United States is very important," he adds.

"We have more than 1,000 companies between the Texas, Arizona and Californian border dedicated to distributing Mexican produce; we have transportation, suppliers, retailers, companies that makes pallets, cartons, fertilizers, seed, coming from the United States, so this is huge for the interest of jobs in the U.S. and Mexico.

"That 350,000 jobs is definitely from the protected agriculture industry, and 50% of those are in the tomato industry. If you were to look at all the jobs the Mexican tomato industry as a whole generates in both countries, it easily exceeds 400,000 people."

Drivers of change

The Mexican tomato industry has been up against the odds many times over the last decade, but for Viramontes this has only made its foundations stronger.

"Over the last 10-12 years we have been involved in many different controversies in terms of situations that were never proven with food safety and security - the United States has been very hard in their demands on Mexico.

"But let me tell you that this has been something very positive for our industry. It's forced our industry to become one of the best industries in the world today.

"We have invested in technology that makes us more efficient, we’re using our resources better, we’re producing with less water, using protected agriculture technology, and this allows us to enhance the elements of nature."

He emphasizes these developments have meant Mexico's tomato industry now uses around 70% less water and has a cleaner product, with third to fifth generation growers that are farmers for the long term.

"Most of them are college educated, the people working the fields are receiving technical education, and we invest a lot of money in training our workers.

"Labor most certainly has become a higher cost, which is fair – people need to be paid right, they are trained so of course we need to pay them better."

Not keeping up

While these demands have pushed Mexican growers to strive for something better, both Jungmayer and Viramontes argue Florida's industry has not kept pace.

"In Florida we don’t see many people investing in technology," says Viramontes.

Of course, there are some growers in Florida investing in technology, but historical decisions have disincentivized industry change.

"In Florida there was one company that was growing commercial heirloom varieties, called the Procacci Company, with their tomato ‘ugly ripe’," says Jungmayer.

"They were very successful in producing these varieties and there was good consumer acceptance, but Florida's growers complained that it went against the Marketing Order, that they didn’t have the right style, with blemishes.

"So Florida has had people trying to produce more flavorsome tomatoes, and the industry said ‘no’. Procacci are still growing the heirloom tomatoes but not in the Marketing Order area."

He says this Marketing Order, which enforces homogeneity, encourages Florida's tomato growers to pick their produce green.

Growing the pie

Viramontes finishes the conversation on a more reflective note, lamenting the high levels of obesity in his country and the U.S. compared to other parts of the world. It is also in this context that he wishes Florida's growers were not pushing ahead to end the agreement.

"The problem is greater, and instead of looking for lawyers and trying to destroy bilateral agreements they have worked for for 16 years, we should be focusing on other problems.

"If we compare the diet with Asia or Europe, they’re probably eating 320 and 350 pounds of vegetables per year, and if you compare to Mexico and the United States, we’re not even eating 150 pounds; we're not even half way to the consumption of some of these countries.

"Let’s start working together in elevating consumption, getting more people to eat tomatoes, more bell peppers, more cucumbers, improving their diets, improving their health."

He says this approach, which the two countries can work towards together, would not only improve market conditions but the well-being of U.S. and Mexican populations.

"Florida is focusing on the wrong problems. They approach it as 'we cannot compete so Mexico must be dumping' and 'we have not invested in technology so the consumer should pay whatever it costs us to produce tomatoes'."

"We have to be honest and look at the real problems."


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