Borderlands: Florida tomato growers want US to terminate Mexico trade deal

Borderlands is a weekly rundown of developments in the world of United States-Mexico cross-border trucking and trade. This week: Florida tomato growers want the U.S. to terminate a Mexico trade deal; a Texas border bridge is shut down temporarily by migrant crossings; Union Pacific will provide rail access to an Arizona industrial park; and Tesla issues a second recall for the electric Semi truck.

Florida tomato growers want US to terminate Mexico trade deal

A trade group is calling on the U.S. to end the 2019 Tomato Suspension Agreement with Mexico, saying it has failed to protect Florida growers against unfair trade practices.

The Florida Tomato Exchange (FTE) said Mexico-based growers continue to dump tomatoes into the U.S. — selling them for less than it costs to produce them — and alleging that the cheaper imports undercut the domestic market.

“Despite the good faith efforts of the Commerce Department over the last four years, the 2019 Suspension Agreement has not been able to close the loopholes that have always been a problem,” Michael Schadler, the tomato exchange’s executive vice president, said in a statement.

The FTE recently filed a request with the Commerce Department to end the agreement because it has “failed to stop unfairly traded Mexican tomatoes from destroying the U.S. tomato industry,” according to a news release.

“It’s become clear that these agreements are simply not enforceable, at least when it comes to the tomato trade with Mexico,” Schadler said. “Suspension agreements might be an effective tool for products that can be kept in storage until market conditions improve, but for highly perishable items like fresh tomatoes, there is just too much incentive to evade the reference prices when markets are oversupplied.”

Tomatoes sold in the U.S. from Mexico are controlled by the U.S. Department of Commerce through the Tomato Suspension Agreement, which sets minimum pricing and regulates sales between growers and importers.

Florida growers have been pushing for more restrictions on Mexican-grown tomatoes for years. Since 1996, the U.S. and Mexico have negotiated five separate agreements regarding tomato imports.

In 2019, the FTE lobbied for stricter quality control on Mexican-grown tomatoes and more enforcement of import pricing.

As part of the 2019 Tomato Suspension 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. 

The 2019 agreement was supposed to protect U.S. tomato growers by eliminating “the injurious effects of Mexican tomatoes, as well as price suppression and undercutting,” according to a news release from the Department of Commerce.

“The department’s action brought the Mexican growers to the negotiating table and led to a result that protects U.S. tomato producers from unfair trade,” former U.S. Secretary of Commerce Wilbur Ross said in a statement. “It also removes major uncertainties for the Mexican growers and their workers.” 

Following the signing of the 2019 agreement, the FTE said the deal was a “step in the right direction to stop further injury to American farmers caused by dumped Mexico tomatoes.”

In 1994, U.S. tomato growers supplied about 80% of the U.S. market while Mexico accounted for 20%, according to the FTE. “Today, Mexico’s share of the U.S. market is almost 70% while U.S. producers have approximately 30%.” 

In 2022, Mexico exported $2.7 billion worth of tomatoes to the U.S., according to the country’s Ministry of Agriculture and Rural Development.

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.

While growers in Florida are urging the U.S. to end the 2019 agreement, officials for the Nogales-based Fresh Produce Association of the Americas (FPAA) said killing the agreement would only result in harming American consumers.

“The FTE has been making the same false claims for years, but when pressed to present evidence in regulatory proceedings, they have failed to do so because their claims are untrue, nothing but propaganda intended to skew the political process to their advantage, regardless of the cost to consumers, retailers, and even other American farmers,” Lance Jungmeyer, FPAA president, said in a news release.

“The duties that are being sought by the FTE would harm U.S. importers, but would ultimately be paid by American consumers who want better tomatoes, not higher prices, reduced varieties, and lower quality tomatoes.”

Texas border bridge shut down temporarily by migrant crossings

Migrant issues forced the closure of the Veterans International Bridge in Brownsville, Texas, for about an hour Thursday.

The commercial cargo facilities at the bridge were closed from 6 to 7 p.m., according to Armando Taboada, assistant director of field operations at Customs and Border Protection’s Laredo Field Office.

“The Veterans International Bridge resumed normal operations after 7 p.m.,” Taboada said in an email to the trade community on Friday. “The Laredo field office and port directors continue to monitor the migrant situation and are ready to implement our business resumption contingency plans. Truck and railroad shipments continue to be consistent and increasing.”

Veterans International Bridge spans the border between the cities of Brownsville and Matamoros, Mexico.

Union Pacific to provide rail access to Arizona industrial park

Union Pacific (UP) railroad announced it will provide rail service to the new Buckeye Industrial Rail Park in Buckeye, Arizona. 

The 260-acre rail park is zoned for distribution, logistics, heavy manufacturing and technology development. Located 40 miles from Phoenix Sky Harbor International Airport, the rail park provides access to several major highways, according to a news release.

The park’s first tenant, Rehrig Pacific Co., recently broke ground on a 260,000-square-foot injection molding plastics manufacturing plant.

“Rehrig Pacific’s groundbreaking represents the first of many exciting opportunities to serve this new industrial park,” Shelly Huckfeldt, UP’s manager of industrial development, said in a statement.

Tesla issues 2nd recall for electric Semi truck

Automaker Tesla recently issued a voluntary recall of 36 of its all-electric Class 8 Semi trucks to fix a software update to ensure the side door warning system works properly.

Officials for the National Highway Traffic Safety Administration discovered that the door-open warning on the truck’s dash only illuminates if the parking brake is disengaged. Federal Motor Vehicle Safety Standards require the warning to be illuminated any time the door is open.

Tesla issued its first voluntary recall in March due to a parking brake issue.

Production of the Semi was supposed to ramp up to as many as 50,000 units starting in 2024. Tesla CEO Elon Musk recently said large-scale production of the truck would not begin until 2025, citing battery supply chain constraints.

Watch: How do you build a tech roadmap?

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