Mexico Says U.S. Tomato Inspection Demand Preventing New Accord

(Bloomberg) -- A top Mexican official on Wednesday said a U.S. demand to inspect all imported tomatoes is preventing producers from the Latin American nation and its northern neighbor from reaching a deal to lift tariffs.

The two sides are close to an agreement, Mexico’s undersecretary of foreign relations Jesus Seade said on Twitter. But the U.S. demand to review 100% of the tomatoes received from Mexico, instead of a sample, would cause logistical collapse at customs checkpoints that would hurt the broader trade relationship, he said.

“If this condition is removed, we have a new agreement in the sector, for the benefit of consumers of this great product in both countries,” Seade wrote.

The negotiation comes after U.S. President Donald Trump in June indefinitely postponed broader tariffs on Mexican goods in exchange for a pledge to do more to stop undocumented migrants from Central America. Talks are also taking place amid an escalating U.S. trade war with China.

An email to the U.S. Department of Commerce press office seeking comment wasn’t immediately returned.

In May, the U.S. began imposing preliminary duties of over 17% on Mexican tomatoes and also resumed a probe from the 1990s, which had been suspended for years, into whether tomatoes from Mexico were sold below the cost of production to make it hard for American growers to compete. Florida growers in November had asked the U.S. government to renew the investigation.

Mexican growers have tried to negotiate a new suspension agreement with the U.S. Department of Commerce. They would need to reach a new accord by about Aug. 19 to allow for 30 days of public comment before the Commerce Department’s Sept. 19 deadline to complete its anti-dumping investigation.

Following a Commerce Department determination in the dumping probe, the International Trade Commission would need to decide by early November whether the behavior, if it occurred, caused injury to American producers. If both conclusions are affirmative, then tariffs would be imposed.

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