CEA Alliance: Quality is hurting the Florida tomato sector—not dumping

The recent termination of the Tomato Suspension Agreement (TSA) has raised multiple concerns among key industry players. While the Florida tomato sector has applauded its termination, citing dumping concerns, others have warned about price spikes and supply crunches.

Tom Stenzel, executive director of the Controlled Environment Agriculture Alliance (CEA), explained to FreshFruitPortal.com that while Mexican tomatoes pose competition for American growers, the reason behind this is more to do with the perceived quality of the fruit, rather than unjust dumping practices in the U.S. market.

“70% of the tomatoes imported from Mexico are grown in greenhouses," he says. "It is the quality of these tomatoes that has won over consumers—not selling below cost.” 

Stenzel emphasized that, unlike what some TSA critics believe, it's on-the-vine and specialty tomatoes that dominate today’s retail landscape and not “the rounds and Romas that Florida grows.”

It might be too early to anticipate any supply dips, Stenzel says, but the official end of the TSA, in conjunction with the newly imposed 17% tariff on Mexican imports starting August 1, will inevitably impact prices for American shoppers.

Higher costs for controlled-environment growers

The executive noted that most greenhouse tomato growers operate across North America and Mexico, and increased costs on greenhouse tomatoes, resulting from the duty hike, may undermine the financial viability of these operations.

Building a modern, high-tech greenhouse can cost between $1 million and $2 million per acre, and only financially robust companies can afford such investments, Stenzel explained.

“By raising the costs on their Mexican production, [the termination of the TSA] actually hurts these same companies financially, reducing their ability to build new greenhouses anywhere,” he said.

Related articles:

"Tremendous effects": Industry braces for tariff hike, lower growth as Tomato Suspension Agreement ends

Florida Tomato Exchange says TSA ‘failed in its basic purpose’ of ensuring fair trade

U.S. Chamber calls on government to reverse Tomato Agreement withdrawal

FTE hails end of Tomato Suspension Agreement as "an enormous victory"