The U.S. is pulling out of a three-decade-old tomato trade agreement with Mexico on Monday, while adding between a 17% to 21% tariff on most Mexican tomato imports.
The Trump administration said in April it plans to withdraw from the Tomato Suspension Agreement between the two countries that has been in place since 1996.
Tomatoes sold in the U.S. from Mexico are controlled by the Department of Commerce through the suspension agreement, which sets minimum pricing and regulates sales between growers and importers.
“The [Tomato Suspension Agreement] has failed to protect U.S. tomato growers from unfairly priced Mexican imports, as Commerce has been flooded with comments from them urging its termination. This action will allow U.S. tomato growers to compete fairly in the marketplace,” the department said in a news release on April 14.
Mexican-grown tomatoes account for nearly 70% of the U.S. market, while U.S. growers’ share is currently around 30%.
In 2024, the U.S. imported $3.12 billion worth of fresh tomatoes from Mexico. This accounted for the majority of the total U.S. tomato imports, which were valued at $3.63 billion, according to the Observatory of Economic Complexity and Texas A&M.
The Laredo customs district in South Texas — which includes Laredo’s World Trade Bridge and the Pharr-Reynosa International Bridge in Pharr — accounts for the majority of tomato imports from Mexico, followed by the border crossing in Nogales, Arizona.
Mexican tomato producers signed an agreement with President Donald Trump’s first administration in 2019 to end a tariff dispute.
As part of the 2019 agreement, Mexico-based growers agreed not to sell tomatoes below a reference price, a seasonably adjusted floor price at which Mexican tomatoes can’t fall underneath and still be exported to the U.S.
Related: US, Mexico negotiating to avoid tariffs on tomatoes, official says
The termination of the agreement has created fierce opposition by farmers and lawmakers in Arizona and Texas versus growers in Florida.
The Florida Tomato Exchange claims that Mexico’s agriculture industry is dumping tomatoes at margins of up to 273% below the agreed minimums in the U.S. that continues to harm domestic farmers.
“The only way to level the playing field is to end the agreement and enforce fair trade,” Robert Guenther, executive vice president of the Florida Tomato Exchange, told Fox Business.
Trade stakeholders and lawmakers in Texas and Florida said any tariff being placed on imports of Mexican tomatoes will harm their state economies and provide consumers with less choice and higher prices.
“We don’t want tomatoes to become the new egg crisis,” Rep. Vicente Gonzalez, D-Texas, said during a news conference on Friday, according to the Rio Grande Guardian.
Gonzalez, along with other Texas lawmakers and the Texas International Produce Association (TIPA), are requesting a 90-day delay to withdraw from the agreement to allow more consideration and resolutions for the issue.
Dante Galeazzi, CEO of TIPA, said the Tomato Suspension Agreement is crucial to South Texas.
“Terminating this agreement will undo three decades of stability and bring about a 17% duty on all Mexican tomatoes entering this country,” Galeazzi said during the same Friday news conference as Gonzalez.
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