US tomato prices could jump as soon as Monday

CNN If tomato prices jump because of new tariffs on the Mexican-grown produce restaurant owner Teresa Razo says her businesses could go bust I give it three months and then we go bankrupt reported Teresa Razo owner of two Argentine-Italian restaurants in Southern California On July a nearly three-decade-old US-Mexico exchange agreement may give way to tariffs on largest part Mexican tomato imports That could mean higher prices for Americans at the grocery store at the pizza parlor anywhere that uses tomatoes And for a few small businesses higher prices could close them down entirely The tomato tariffs are among the latest examples of President Donald Trump s chaotic tariff strategy which has shaken up global pact left companies uncertain how to plan for the future and made Americans nervous about where the world s biggest business sector could be headed Field-grown tomatoes cost US shoppers about per pound as of May according to the Bureau of Labor Statistics Consumer tomato prices could rise by about and demand may fall by as a development of these tariffs according to Timothy Richards a professor of agribusiness at Arizona State University The United States is the top territory for Mexican tomato exports according to the US Department of Agriculture In a June statement the department revealed that the new tariffs would likely lead to a drop in tomato imports and higher prices Various US growers say it s about time for the tariffs which are meant to fight dumping or the practice of selling cheap exports into a foreign realm to undercut homegrown products The Tomato Suspension Agreement has been in place since essentially setting a floor for tomato imports The Commerce Department declared in April it was withdrawing from the agreement because the current agreement has failed to protect U S tomato growers from unfairly priced Mexican imports according to a report That in turn will upshot in the duties on majority of Mexican tomato imports For more than three decades five consecutive agreements have failed to stop the illegal dumping of unfairly priced tomatoes into the U S domain from Mexican producers Robert Guenther executive vice president of the Florida Tomato Exchange notified CNN in a message Guenther added that he believes the commerce agreement has harmed American farmers It s an accusation disputed by Walberto Solorio a Mexican tomato grower and president of the Baja California Agricultural Council which represents more than tomato growers Solorio narrated a CNN producer that small violations by various Mexican producers have not been enough to warrant the collapse of the entire agreement I see it as more of a political issue than a commercial one not logic or numbers Solario reported Everything indicates within reason that the agreement should prevail and that the agreement has been fulfilled Instability and fear Consumers and businesses may feel the pinch Somebody that would dine out three times a week maybe now they ll do it once or twice because we have to increase our prices declared Razo who requirements tomatoes for salads and for marinara sauce in pizzas and pastas at her restaurants Villa Roma in Laguna Hills and Cambalache Grill in Fountain Valley But particular companies will avoid the tariffs because they use US-produced tomatoes Heinz uses only domestically grown tomatoes for its ketchup products sold in the United States DiGiornio also states on its website that its frozen pizza sauces are made with California-grown tomatoes And particular small businesses like Appollonia s Pizza in Los Angeles might eat the cost of using Mexican tomatoes for its toppings instead of passing it on according to co-owner Justin De Leon But not everyone can afford that Razo is trying to source tomatoes from domestic growers instead but if she can t find US tomatoes fast enough she might have to raise menu prices With often last-minute changes to tariff implementation this year she s stopped following the news every day for her mental healthcare She revealed she ll take a wait-and-see approach with the tariffs before devising a strategy and added that the tariffs have created instability and fear We don t need more of that Razo commented We already have enough Guenther disclosed American tomato growers can produce enough tomatoes year-round thanks to technological advancements and geographic diversity across the United States Terminating the agreement would still allow Mexican producers to sell tomatoes in America they d just have to comply with contract laws But Solorio mentioned Mexican imports have been subject to thorough quarterly audits We have complied with the minimum reference prices with the reports with the limit quality inspections he disclosed De Leon mentioned Appollonia s Pizzeria uses Mexican tomatoes for its fresh tomato toppings while its sauce is made with California tomatoes He changes where he buys his tomatoes from to get the best in-season produce year-round switching from California to Mexico tomatoes depending on the season Tariffs on key ingredients like cheese are already costing him more and can be just another headache in a stressful business I just hope it comes to an end soon De Leon revealed