As anticipated, a long-standing trade agreement between the U.S. Commerce Department and Mexico has officially expired — a development first reported by Straight Arrow News on July 11. One of the largest tomato importers, NatureSweet, warned it may need to raise prices by 10% as a result.
How will this affect prices on store shelves?
NatureSweet tomatoes are sold at major grocery store chains including Kroger, Walmart and Whole Foods. According to Tim Richards, a professor at Arizona State University’s Morrison School of Agribusiness, retail prices are expected to jump by approximately 8.5%.
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Why did the trade deal collapse?
The now-expired Tomato Suspension Agreement, established back in 2019, was designed to settle a trade dispute over Mexico allegedly dumping tomatoes in the U.S. – selling them below market value.
Under the agreement, Mexican exporters could avoid tariffs if they adhered to U.S. pricing and regulatory guidelines. That arrangement is now over.
According to the Florida Tomato Exchange, Mexico supplies about 70% of the tomatoes sold in the U.S., primarily greenhouse-grown vine-ripened varieties. Florida-grown tomatoes, by contrast, are typically field-grown and picked before ripening.
Reaction on both sides of the border
Robert Guenther of the Florida Tomato Exchange called the decision to terminate the agreement “an enormous victory for American tomato farmers and American agriculture.“ His organization represents domestic growers who distribute over one billion pounds of beefsteak, Roma, grape and cherry tomatoes annually to states including California, Georgia, New Jersey, North Carolina, South Carolina, Tennessee and Virginia.
In a statement to Straight Arrow News, Guenther added, “We’re grateful for the decisive, bold, and crucial action taken by the Trump administration to terminate the U.S.-Mexico Tomato Suspension Agreement. This 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.”
But Mexico’s Economic Secretary, Marcelo Ebhard, disagrees. In a quote published by The Associated Press, he said: “It’s unfair and against not only Mexican producers, but also on the American industry. The ground that Mexican fresh tomatoes have gained in the U.S. is because of the quality of the product, not from unfair practices.”
What’s next?
Imports of vine-ripened, grape, Roma, cocktail and other specialty tomatoes are all expected to see price increases.
NatureSweet’s CEO previously said there is “no scenario” in which the company can absorb the full tariffs without passing at least some cost to consumers.
