Mexican Growers Update Proposal for Shipping Tomatoes to U.S.

WASHINGTON, May 23, 2019 /PRNewswire/ -- Mexican Tomato Growers submitted a new proposal Wednesday to the U.S. Department of Commerce for a new agreement covering imports of tomatoes from Mexico.  Because Commerce terminated the prior agreement on May 7, the Mexican growers were required by Commerce Department regulations to make a formal proposal on May 22.

This proposal builds on the strongest provisions of the prior agreement and the April 2 proposal of the Mexican growers to bring an unprecedented level of enforcement. The proposal includes the following:

• New reference prices with increases of up to 180 percent for expanded categories of tomatoes.
• Expansion of the USDA marketing order on tomatoes to cover all categories of tomatoes, which would bring enforcement to the border for the first time, with tomatoes that fail the marketing order being denied entry into the United States.
• Removal of 100 percent of defective product from the U.S. market through return to Mexico over a certain threshold and destruction supervised by USDA for the remainder.
• New penalties for shipments containing above a certain level of defective product. 
• Expansion of the formal process for considering alleged agreement violations.
• Elimination of sales under another company's signatory number to deter circumvention.
• Submission of voluminous amounts of sales, volume, customer and contract data, all subject to Commerce Department verification.
• Linkage of the suspension agreement provisions to PACA penalties.
• Submission of certified statements that could lead to civil penalties if false.

The only area the Mexican growers have not considered is the request by the Florida Tomato Exchange to restrict the rights of U.S. buyers to liquidated damages for breach of warranty.  While breaches of warranty do not occur often, the Mexican growers do not have the legal right to deny damages.  In order to even consider such a proposal, the Mexican growers asked for formal opinions from the U.S. Department of Agriculture that the rights of U.S. buyers can be restricted; from the Commerce Department that it has the jurisdiction based on record evidence to request this; and, from the U.S. Department of Justice that there are no antitrust violations.

"We submitted a very strong proposal to Commerce in April.  Since then, we have made limited progress in the negotiations.  We hope that Commerce looks closely at this proposal to see how powerful it is," said Rosario Antonio Beltran, President of the growers' association in the state of Sinaloa.  Benjamin Esquer of the Sonora state growers' association added "Our growers are eager to get back to work and we hope that this proposal finally ends this long process that has affected so many people in both countries."

"This is an even stronger proposal than we submitted in April.  It is time to reach a new agreement," said Salvador Garcia, the President of the Baja growers' association.  Added Oscar Woltman, president of the largest grower association in Mexico, "there are 1.4 million direct and indirect jobs at stake in Mexico and tens of thousands in the United States.  It is time for common sense to rule so we can get back to work."

SOURCE Mexican Tomato Growers