Save tomatoes: Probe dumping and end unfair trade practices

In the world of high-stakes international trade, Florida’s tomato growers, most of whom toil in the shrinking fields of South and Central Florida, have rarely gotten a fair shake.

When Congress passed the North American Free Trade Agreement in the 1990s, the celebrated deal widely opened the gates for competing Mexican tomatoes to enter the U.S. marketplace. Before long, Mexican tomatoes cut deeply into the market share once held by Florida growers.

The impact on Florida growers has been jarring. Under pressure from governmentsubsidized Mexican tomatoes, the annual output by Florida farmers — many of whom have gone out of business — fell a whopping 46 percent between 2000 and 2017, according to the Florida Fruit and Vegetable Association.

Then, under a push by “America First” minded President Donald Trump, came “NAFTA 2.0,” or the newly branded United State-Mexico-Canada-Agreement. It was a good deal, Trump said, for the auto industry, as well as dairy and poultry farmers seeking greater to access to Canada’s heavily protected markets.

But once again, Florida’s tomato and other vegetable growers were ignored.

In testimony before the International Trade Commissions last year, executives from the fruit and vegetable association pleaded for help under the new deal, arguing that Mexican gains since NAFTA were not the result of market conditions, but a systematic flow of Mexican government subsidies. Those subsidies, the association said, “have supported virtually every dimension of Mexico’s skyrocketing fruit and vegetable production. They would likewise not have occurred had the Mexican industry not engaged in chronic unfair pricing, which has been fundamental to its growth strategy.”

For all of the talk of a need for a wall to stem illegal immigration, there were no impediments to the flood of Mexican tomato imports. Southeast vegetable producers, including those in Florida, literally had no trade tools to counter the onslaught.

That was until earlier this month, when the Trump Administration, acting after a bipartisan outcry from nearly 50 lawmakers in Florida and elsewhere around the nation, declared it will reopen an antidumping investigation into tomato imports from Mexico, and say good-bye to a 2013 agreement that had suspended any investigations into unfettered dumping.

The action is long overdue. It’s easy to see why.

In their letter to the U.S. Commerce Department, the lawmakers noted that hundreds of growers have been forced to leave the business since 1996, the year of the first suspension agreement. Meanwhile, Mexico’s share of the U.S. market has risen from 34 percent to 54 percent, while the American share has declined from 65 percent to 40 percent.

Florida growers had hoped NAFTA 2.0 would allow for anti-dumping investigations. But that didn’t happen in the face of protests by California seasonal crop growers who feared the provisions might be used against them by Mexico and Canada.

The lawmakers, led by Florida Sen. Marco Rubio and fellow Republican Rep. Ted Yaho from North Florida, asked Commerce Secretary Wilbur Ross to end the 2013 suspension agreement, which set price floors for Mexican tomatoes entering the U.S. But the agreement prevented American growers from seeking antidumping charges against Mexican exporters.

“The U.S. tomato industry has been the canary in the coal mine for domestic fruit and vegetable production over the last three decades,” Rubio said in a statement. “Immediately terminating the suspension agreement will reinvigorate the antidumping investigation on fresh tomatoes from Mexico and send the message that the U.S. will ensure vigilant enforcement of our existing trade laws and trade agreements.”

The lawmakers also contend the Mexican exporters “have shown no interest in accepting a suspension agreement that would close the loopholes that permit them to continue dumping tomatoes and injuring American tomato growers and packers.”

Michael Schadler, executive vice president of the Florida Tomato Exchange, which represents growers and handlers, told the South Florida Sun Sentinel this week that the Trump Administration’s move is a “small victory ahead of a much bigger and longer battle.”

At this point, he said, the industry has two options: proceed with the termination of the 2013 agreement on May 7, plus an anti-dumping probe; or re-enter negotiations with the Mexicans.

The growers, whose ranks have plunged from a peak of more than 250 in the 1980s to 25 today, aren’t optimistic they’d make any progress at the negotiating table. “They like the current arrangement,” Schadler said of the Mexican growers. “Their negotiating has been to find ways to keep the status quo.”

The status quo consists of the exploitation of loopholes, where transportation costs are “discounted” for shipments from Mexico growers to markets in the Northeast and elsewhere in the U.S. The shippers might bill for a half a load of tomatoes, but put a full load on the truck. And in a practice called “back sheet billing,” buyers pay today’s floor price under the agreement, but pay a rebate to suppliers when the market goes up.

The commerce department, Schadler said, lacks the means and people to check for honest dealing. “It’s a fool’s errand we’ve gotten ourselves into,” he said. “The writing is on the wall and we’re reaching a tipping point; we’re trying to make a stand here.”

Given all that’s transpired, it’s past time to take the Mexican shippers to the mat in a full bore anti-dumping probe. The growers need a level playing field. And NAFTA 2.0 or not, it’s time for the U.S. government to stop decades of dithering and put the Mexicans’ feet to the fire — before the last of our growers disappear into the history books.

Editorials are the opinion of the Sun Sentinel Editorial Board and written by one of its members or a designee. The Editorial Board consists of Editorial Page Editor Rosemary O'Hara, Sergio Bustos, David Lyons and Editor-in-Chief Julie Anderson.