Tomato Supply Squeeze Could Trigger Higher Prices

WASHINGTON—Tomatoes could be in shorter supply this winter, due to a new inspection agreement on Mexican tomatoes that could trigger border delays and higher prices at the store, USA Today reports.

Last week, the U.S. Department of Commerce inked a deal with exporters and tomato growers in Mexico that will tinker with base prices and require inspections of grape, Roma and round tomatoes sold in bulk. The scrutiny aims to “to prevent the importation of low-quality, poor-condition tomatoes from Mexico, which can have price-suppressive effects on the market,” according to the department.

With more than one in two tomatoes consumed in the United States arriving from south of the border, the changes are likely to produce high prices and possibly shortages. “Especially during the winter months, when the U.S. tomato supply can be disrupted by hurricanes, frost or freeze in the Southeast, prices will be volatile because there will be fewer supplies from Mexico which typically provide a moderating effect on tomato prices,” said Lance Jungmeyer, president of the Fresh Produce Association of the Americas.

The new arrangement could cap a long-standing disagreement between Mexican and U.S. tomato growers, with American farmers arguing that their Mexican counterparts are sending inferior quality fruit to the United States and selling it at a lower price point. Michael Schadler, executive vice president of the Florida Tomato Exchange, said, “We are hopeful that the new agreement will stop the dumping of Mexican tomatoes, which had driven many American tomato growers out of business in recent years.”

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