Tomato leaders spar before the International Trade Commission



Tom Karst | The Packer

Mexico and U.S. tomato leaders sparred Oct. 25 in testimony before the International Trade Commission that is likely to determine the fate of the new tomato suspension agreement.

Within 45 days, the ITC will determine if Mexican dumping of tomatoes has caused injury to U.S. growers.

In testimony before the International Trade Commission, tomato industry leaders from Mexico and the U.S. gave widely differing views on what has been driving demand for Mexican tomatoes.

Michael Sullivan, CEO and president of Gargiulo, Inc., was among those speaking in support of the antidumping duty on Mexican tomatoes.

One excerpt from Sullivan’s testimony: 

“In 2019, we decided that we had to plant fewer acres, and our packing houses are only operating at about 80 percent of our capacity. When the suspension agreement terminated, the prices initially increased, but then returned to the normal – ‘low – level as imports from Mexico continued. Depressed sales values and low operating profits are not sustainable. If we do not get relief, real relief, from the dumped tomatoes imported from Mexico, we will continue to reduce acreage and eventually we will close our farms. By way of illustration, in 2005, we farmed 8,363 acres, with an average employee count of 2,400. In 2019, we are farming 6,500 acres, with an average head count of 1,600.”

Sullivan continued: 

‘We hope the new Suspension Agreement will work. However, given the history of all of the past Suspension Agreements, it is an open question whether it will work. We need antidumping duties to ensure a level playing field in case the Suspension Agreement fails. Otherwise, there is nothing to stop the dumped Mexican tomatoes from putting American farms out of business. Without this relief, we will not survive.”

Those opposed

Among those speaking opposition of the antidumping order, Lance Jungmeyer, president of the Fresh Produce Association of the Americas. Jungmeyer said that Mexican tomatoes have helped advance the entire industry, including Florida growers. From his written testimony to the ITC:

“You are here today to decide whether imports of fresh tomatoes from Mexico injure or threaten to injure the petitioning US industry. The following facts demonstrated that the answer to that question should be a resounding “NO”. 

The data show that, since this saga began in 1996, the petitioners have done little to innovate or move their horticultural interests forward. With the continued market share decline of their primarily field-grown gassed green tomato product, the (Florida Tomato Exchange) companies have largely hitched their wagons to their competitors in Mexico, investing in fields, packinghouses and strategic partnerships there in order to remain relevant in the marketplace. Indeed, far from causing injury, the importation and distribution of Mexican tomatoes is one of the only things keeping FTE marketing companies in the game. 

While FTE would also have you believe it has lost market-share in the United States, this is actually not the case. The companies that represent the largest volume of US production, some of which testified here this morning – Lipman Family Farms, Pacific Tomato Growers, Proccacci Brothers and DiMare Fresh – have all started growing in Mexico or purchasing Mexican tomatoes that they then distribute in the United States. Instead of investing in protected agriculture technology in the United States, they have made the business decision to grow, import and distribute Mexican tomatoes. Over the last few years, they have systematically bought up distribution operations all across the United States and transitioned from tomato farming to tomato marketing.”

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