Less than one month after the U.S. Department of Commerce finalized an agreement with Mexican tomato growers to suspend the ongoing anti-dumping investigation of fresh tomatoes from Mexico, the Florida Tomato Exchange has filed a request for a continuation of the inquiry.
The investigation was suspended on Sept. 19, when Commerce officials and Mexican tomato growers and exporters signed a new tomato suspension agreement.
Under U.S. trade law, however, domestic producers may request continuation of the anti-dumping investigation.
Maitland-based FTE said the Mexican tomato industry has signaled its intention to challenge the agreement legally and politically.
In an Oct. 3 letter to the Commerce Department, the Mexican growers association CAADES and others signaled they may challenge the new suspension agreement in court.
CAADES and Mexican producer Red Sun Farms have pending litigation against the U.S. government at the Court of International Trade. The appeal by Red Sun Farms argues Commerce unlawfully terminated the 2013 suspension agreement and that the old suspension agreement should be reinstated.
Termination in question
Commerce resuming the investigation will not necessarily terminate the suspension agreement, and FTE said its objective in taking this action is to protect the integrity of the recent agreement.
The suspension agreement will remain in effect during the resumed investigation. Upon
completion of the investigation, Commerce and the International Trade Commission officials will determine whether or not Mexican tomatoes were dumped in the U.S. and whether the dumping caused injury to the U.S. tomato industry.
If both determinations are affirmative, the suspension agreement will remain in place, and duties will not be imposed. If there is a negative finding, the proceeding will end, the suspension agreement will be terminated, and there will be free trade.
The new tomato suspension agreement will continue even if Commerce and the ITC make affirmative findings. According to FTE, an affirmative finding should discourage the Mexican tomato industry from using legal and political maneuvers to try and weaken the agreement.
Any future withdrawal from the agreement by either Mexican growers or the Commerce Department would automatically trigger a 90-day window to renegotiate before anti-dumping duties are imposed.
This latest battle in the ongoing trade dispute between U.S. tomato suppliers and Mexican grower-shippers began last November, when FTE asked Commerce officials to terminate the 2013 Suspension Agreement on Fresh Tomatoes from Mexico.
On Feb. 6, the Commerce Department notified the Mexican signatories that it would withdraw from the 2013 tomato pact, and on May 7 the 2013 agreement was terminated, resulting in Commerce officials continuing an anti-dumping investigation on imports of fresh tomatoes from Mexico and slapping a 17.56% duty on product shipped to the U.S.