New tariff sparks tomato war between importers and US growers

A new levy on tomatoes has pitted some restaurateurs, importers and cherry tomato aficionados against Florida farmers and their signature crop: the big, round tomatoes commonly sliced for burgers.

Tomatoes imported from Mexico will be subject to a 17.09 percent levy starting in mid-July as the Trump administration withdrawsfrom a decades-old trade agreement.
Tomato growers in Florida - a top tomato-producing state - say the new duties protect domestic farmers, but others in the industry say it will backfire because about 65 percent of US-consumed tomatoes come from Mexico, including most of the sweet, vine-ripened and small varieties that are increasingly popular with shoppers.

"Consumers will be left with fewer choices,” said Skip Hulett of NatureSweet, a Texas-based company that grows most of its tomatoes in Mexico.

The new duties are opposed by retail and restaurant associations who say it could limit year-round access to tomatoes at a time when shoppers have become accustomed to seeing heirloom, cherry and other varieties regularly stocked in stores.

But Florida growers say it helps level the playing field for an industry decimated by imports, and that US crops offer the same variety and taste profiles that Mexican tomatoes do.

"Competition is all good as long as it’s fair,” said Tony DiMare, president of DiMare Inc., a 97-year-old company that grows and distributes tomatoes in the United States.

Mexico is the largest supplier of tomatoes available in the US.

Young cherry tomato plants at the NatureSweet production facility in Bonita, Arizona, on April 23. (Photo by Anna Watts for The Washington Post)

Excluding tomatoes grown for packaged sauces and ketchup, the volume of tomato imports from Mexico increased 176 percentfrom 2000 to 2023, according to federal data.Imports now make up more than$3 billion, or 70 percent, of the US tomato market, up from 30 percent three decades ago.

Meanwhile, Florida’s industry has declined. Tomatoes grew on about 61,800 acres across the state in 1990 compared with 23,000 acres now, DiMare said.

The North American Free Trade Agreement of the 1990s helped spur the market reversal, experts said. They also creditedMexican producers’ heavy investment in greenhouses - which are better for growing specialty tomatoes and have been behind much of the increase in imports. Nearly 90 percent of the US’s greenhouse-grown tomatoes were imports in 2023.

Importers and multinational growers say the popularity of greenhouse tomatoes shows that consumers prefer those sweet and small varieties tothe rounds grown in Florida, which are typically grown outdoors, picked green and ripened with a naturally occurring gas that helps extend shelf life and improve appearance.

"The market has said, well, they don’t really want that tomato,” said Lance Jungmeyer, president of the Fresh Produce Association of the Americas, which represents firms that import and distribute Mexican produce.

The Florida rounds are "large, watery,bland,” said Hulett, with competitor NatureSweet.

But Florida growers say consumers prefer U.S.-grown products - and largely attribute their decline to Mexico’s cheap labor costs. US tomatoes are "comparable to

Mexican tomatoes in ‘flavor, freshness, color, texture, and shape,’” said Robert Guenther, with the Florida Tomato Exchange, citing findings from a 2019 US International Trade Commission report.

The new duties should help "create a more stable and predictable marketplace where domestic producers can thrive,” he said.

These arguments haven’t changed much in recent years, said George Frisvold, an agricultural economics professor at the University of Arizona. But with the Trump administration pushing for widespread tariffs, the Florida growers probably "have a more receptive ear now,” he said.

The new tomato levystems from a 1990s agreement that allowed Mexico to export tomatoes to the US duty-free if it follows certain trade rules, including quality inspections and minimum sales prices. The agreementstaved off a US investigation into whether Mexico was exporting tomatoes at artificially low prices. But the

Commerce Department in April said it would withdraw from that agreement and impose the 17.09 percent antidumping duty on July 14.

"The current agreement has failed to protect US tomato growers from unfairly priced Mexican imports,” the department said in a release.

The Mexican government has said it hopes to work with the United States to renew the accord and floated the idea of taxing US meat in retaliation.

Companies that import or grow Mexican tomatoes are braced for a significant hit when the tariff takes effect. It’s an "existential” threat, Hulett said.

NatureSweet expects to pay millions of dollars each month in duties and will have to raise prices for consumers, Hulett said.Mexican exporters expect the duties will be costly and lead to more expensive tomatoes, said Germán Gándara, president of a Mexican tomato growers’ association and chief executive of Ganfer, a large greenhouse vegetable producer in Mexico.

Some US companies - including distributors and grocers - indirectly make money off tomato imports and could be affected as well, said Andrew Muhammad, an agricultural economist at the University of Tennessee at Knoxville.

The average US retail price of a tomato in 2023 was $1.92 per pound, while the farm price was 60 cents per pound - meaning less than a third went to Mexican growers, Muhammad said.

Fort Worth restaurateur Adrián Burciaga buys more than 350 pounds of tomatoes each week for Don Artemio, the Mexicanrestaurant that he co-owns.He can raise prices or look for another supplier for the tomatoes - mostly Romas from Sinaloa, which he prefers for "flavor and authenticity of culture” but it’s not easy. Restaurants have thin margins, he said, and "we don’t want to sacrifice quality.”

The new duties are expected to increase US grocery store prices, adding to recent high inflation, economists said. The Trump administration has considered other tariffs on a range of products; any of those imposed on tomatoes could drive up prices further.

Still, that cost increase might not be enough to daunt shoppers. If 5 percent of the duties are passed on to a consumer who spends $100 a year on tomatoes, "that’s another 5 bucks,” said Daniel Sumner, an agricultural economist at the University of California at Davis.

Mexico has cheaper operating costs than does the US and a temperate climate that makes it possible to grow tomatoes year-round, industry observers said.The better weather also lessens the cost needed to heat and cool greenhouses, which some growers say have transformed the industry.

"You get better color, you get better flavor, and a lot of these varieties are not grown domestically because they have to be grown indoors,” said Matt Mandel, a vice president at Arizona-based produce company SunFed, which grows Roma and organic grape tomatoes in its greenhouses in Mexico.

The higher cost to build and light a greenhouse in the US - particularly in areas prone to extreme weather - has slowed the technology’s spread, though it is now advancing swiftly, industry observers said. Just over a third of US tomatoes were grown in greenhouses in 2023.

The new duties don’t limit the volume of tomatoes exported to the US, but that might happen anyway as Mexican growers anticipate lower sales or exit the US market altogether, some trade experts said.

Unlike corn or soybeans, tomatoes can’t be socked away and stored if the market is saturated, which makes them particularly susceptible to dumping, said Zhengfei Guan, a food and resource economics professor at the University of Florida.

"Sell it or smell it,” Guan said. "If you don’t sell it, it’s worthless.”