Wednesday, November 14, 2012
This month U.S. and Mexico officials are expected to reach an agreement on a bilateral tomato trade pact. The two countries are approaching one final road bump: minimum price.
According to Mexican business sources, the final hurdle remains the minimum price, although both countries have agreed on the packing of Mexican tomatoes and what percentage of exports would receive bargain pricing — from the current 85 percent to Mexico's desired 100 percent.
The pact will remain active for no more than 270 days after September's Commerce Department decision.
Price is a continuing issue. As we reported in September, Florida farmers argued the cheap price of Mexican tomatoes was undercutting their ability to turn a profit. Reggie Brown of Florida Tomato Exchange gave an example: the average box of Florida tomatoes sells for about $6. The cost to grow that box is $9-10. In Mexico, costs $5 to grow a box of tomatoes and sells for $9.
The talks have come a long way since the beginning of December. When the trade pact almost dissolved and there were threats of an impeding trade war.