The last time the U.S. and Mexico were in a shooting war was 1848. But seemingly shortly after that the trade war that has dogged U.S. specialty ag producers for years started. The latest salvo in that battle was launched this week by Florida Commissioner of Agriculture Adam Putnam, who fired off a two-page letter to Department of Commerce Secretary Wilbur Ross asking for an investigation into unfair trade practices.
Imports of Mexican agricultural products “have a disproportionate impact on Florida’s producers,” the commissioner’s letter said. Since 2000, Mexican imports have “increased dramatically proving particularly injurious to Florida Agriculture’s specialty crop sector.”
Putnam said he believes “many of these commodities are unfairly subsidized and are pouring into the U.S. market in high volumes at prices significantly beneath the cost of production…causing disproportionate economic injury.”
Mexico has long denied any attempts to flood the U.S. with product at rock-bottom pricing.
Putnam stopped short of calling Mexico pants-on-fire liars, instead blaming NAFTA for creating “anything but a fair and level playing field.”
The letter reminded Ross of Donald Trump’s America-First campaign pledges and urged “an investigation into Mexico’s unfair trade practices, which have allowed Mexican producers of specialty crops to – in a matter of 20 years – become the dominant supplier of specialty crops into the U.S. market. These unfair trade practices have resulted in the continued decline of domestic production of these crops.”
This is a fight Florida growers have been waging for years. The larger concern, they say, is that continued Mexican dominance of specialty crop production has chipped away at U.S. production little by little, almost unnoticed, until it now threatens domestic specialty ag production as a whole.
Some Don’t Know How Long They Can Farm
“This is clearly a significant issue for Florida’s specialty crop industry,” Florida Fruit & Vegetable Association Director of Public Affairs Lisa Lochridge told SPW. “Unlike other agriculture sectors that have benefited from free trade with Mexico, NAFTA has dealt a big blow to Florida growers during the past two decades. Cheap Mexican tomatoes, peppers and strawberries pour into the country during Florida’s harvest season, depressing the market for produce grown here. This year has been particularly devastating — some growers don’t know how long they can continue to farm. We’re working with the Florida Department of Agriculture in calling for solutions that would stop the flood of low-priced Mexican produce into the U.S.”
Reggie Brown has been in the forefront of the battle for two decades as head of the Florida Tomato Committee. The tomato industry was once one of Florida’s ag giants but it has been in steady decline for two decades. In the mid-1990s, American growers first suggested Mexico was dumping tomatoes into the U.S. market at prices American growers could not compete with. The U.S. Department of Commerce stepped in and negotiated an agreement with Mexican suppliers that set minimum prices and suspended a pending investigation into illegal dumping.
That tomato suspension agreement was renewed in 2002, 2008 and 2013. It’s the only thing that has kept Florida tomato growers from folding up the tent and calling it a day.
Agreement ‘Decelerated the Decline’ of Domestic Industry
“Even with that tool being exercised and the commerce department negotiating numerous suspension agreements during that period, the domestic tomato industry is still in a decline. And that decline and that pressure is coming from large volumes of product entering the U.S. market even with the suspension agreement in place,” Brown told SPW this week. “Had that not been exercised 20 years ago I think you would see a very different structure of the domestic tomato industry, if there was a domestic tomato industry. The agreement decelerated the decline of the domestic tomato industry but its decline is still undeniable given the onslaught of Mexican imports.”
No one is saying Mexico should not be growing and exporting tomatoes (or anything else). What the domestic produce industry is asking for is a level playing field, a fighting chance. It’s tough to be the guy with the peashooter in a gunfight. A fair and reasonable referee would make sure the contestants were equally armed.
There is hope that the Trump administration will step in and provide some help, and that hope is amplified by the appointment and confirmation of former Georgia Gov. Sonny Perdue – a farmer himself — as the new U.S. Secretary of Agriculture.
“The imports of tomatoes have reached the magnitude that they have an impact on the entire domestic tomato industry, not just Florida,” Brown said. “Florida has traditionally been in the forefront of that struggle to compete with Mexico [but] the impact is year-round now and not just seasonal as it had been with Florida. The explosion of production of not just tomatoes but other items that has happened in the last decade is cause for very serious concern.
Tipping Point Is Near for U.S. Growers
“If we have any desire to continue to have a production system in the United States, someone in the administration needs to pay very close attention to what is happening – because the tipping point for the loss of the Florida production winter capacity is certainly on the horizon.”
Brown said he has not yet spoken with Perdue, but that “Secretary Ross of the commerce department is very cognizant of the situation and hopefully will be helpful in trying to work our way through this national dilemma.”
Whether Putnam is successful in his request or simply makes Americans more aware of the situation, Brown said “we’re at a critical point where it is necessary to fight the fight and make the effort in the interest of grower-shippers for commodities that are under stress from significantly expanded import volume.”
And while the Florida ag commissioner doesn’t directly accuse Mexico of covering up how the situation became unbalanced, Brown has no such qualms.
“There has been such a tremendous change in the structure of the industry in Mexico in the last 10 years, from an open-field with some protected culture system to a virtually protected culture system and some open field, one would wonder where all the capitol came from to fund all of that. Those are some of the concerns that are out there,” Brown said.
He hopes the commerce department will “self-initiate and look into and address some of those issues,” since any violator of protocol is unlikely to come forward and admit wrongdoing – and it’s impossible for U.S. growers to find out the truth on their own.
“You’re looking over the fence and generally there’s a string of laundry between you and what you’re trying to look at,” Brown said. “Even if you see occasionally, it’s only when it flaps in the wind. But you’ve got to fight the fight.”
(Read Commissioner Putnam’s entire letter here)