UF Economist: Mexican Shipments Devastating State Tomato Growers
GAINESVILLE—Florida tomato farmers are again under siege by Mexican growers who are dumping record numbers of winter tomatoes on the U.S. market, driving prices down and violating quotas set forth in NAFTA, says a University of Florida economist.
Last year, Florida’s tomato growers were hit hard by Mexican shippers, forcing the Florida Tomato Exchange, an agricultural cooperative, to seek relief from the International Trade Commission. That petition was turned down. A year later, with the winter growing season now in full swing, tomato growers are facing a crisis that is even worse, said Professor John Van Sickle of UF’s Institute of Food and Agricultural Sciences.
“Our farmers are in a bloodbath right now,” said Van Sickle, who has monitored commodities at UF since 1980. “Some of our growers are losing $100,000 per day, and emotions are running very high.
“The safeguards that were built into NAFTA to protect our growers from surges of Mexican imports have been totally ineffective,” he said. “This is the kind of market that is going to put large shippers out of business.”
Van Sickle runs the Market News System, (accessible on the World Wide Web at (http://www.ifas.ufl.edu/~marketing/market.html), and has become an industry watchdog on the NAFTA issue. Last year, he was the first to report that Mexico violated NAFTA tariff rate quotas by as much as 18 percent during one market window.
This year, he said sadly, the same thing is happening. According to his research, Mexico likely will exceed NAFTA quotas this weekend or by early next week.
“The tomato industry in Florida is in the worst shape I have ever seen,” Van Sickle said. “Because of the Mexican shipments, our prices are down to below $4 per carton — below the cost of harvesting, packing and shipping. Growers can’t even afford to pick them.”
Wayne Hawkins, executive vice president of the Florida Tomato Exchange, an agricultural cooperative that represents tomato shippers in Central and South Florida, agrees with Van Sickle’s assessment.
“We’re getting crucified,” Hawkins said. “We’d be better off if we picked the tomatoes and threw them into the road.”
Hawkins said some large grocery chains purchase Mexican tomatoes on consignment, with no concern for domestic producers. The grocers then market them for high price returns, often blending the cheap Mexican tomatoes with those grown in the United States and selling them for the same price. “There’s a license to steal out there,” Hawkins said. “It just looks like Mexico is trying to break us.”
Statistics show the industry in decline, with NAFTA the likely culprit, Van Sickle said. Two years ago, Florida’s tomato growers numbered more than 200. This year, there are less than 100. The industry peaked at $700 million a couple of years ago, but shrunk to $400 million in 1995. Florida shipments to the U.S. market are down by 30 percent, Van Sickle added. “We did three times the volume prior to NAFTA.”
Hawkins also reports that in the past year, 100 growers have dropped from his association’s mailing list and he has seen 24 packers “close the door.”
At a recent Florida Tomato Exchange meeting, Hawkins said members were fighting mad and acting irrationally. “It was nothing but a yelling match blasting the federal government,” he said.
Hawkins, too, points the finger at the Clinton administration who he said promised to protect Florida growers under NAFTA if the state’s legislators voted for the agreement. That protection, Hawkins said, has yet to be seen.
“The only remedy we have right now is to get the president to give us relief,” Hawkins said. “With one stroke of his pen, he could help.”
That relief must come soon, he said. “Without relief in seven to 10 days, tomato growers in Florida will be in a hole too deep to crawl out.”