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Salsa will become more expensive, Democrat says

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Mexican producers say their produce cannot be replaced

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Mexican growers still hope to negotiate deal

(Adds details paragraphs 1, 4, 7-9)

By Kanishka Singh

WASHINGTON, July 14 (Reuters) - The Trump administration

announced on Monday a duty of about 17% on fresh tomatoes from

Mexico, which account for two-thirds of the tomatoes eaten in

the U.S., and the end of an export deal between the two

countries.

The Commerce Department said the U.S. was withdrawing from a

2019 agreement with Mexico that suspended an antidumping duty

investigation on Mexican tomatoes, whose exports to the U.S. are

valued at $3 billion a year.

The move came as President Donald Trump's administration

seeks to negotiate comprehensive trade agreements with virtually

every trading partner after the president launched a dizzying

series of tariff announcements in April.

The U.S. and Mexico first struck an agreement in 1996 to

regulate Mexican tomato exports and address U.S. complaints of

unfair competition. The pact was last renewed six years ago to

avert an antidumping investigation and end a tariff dispute.

Mexico said in April it was confident that it could renew

the tomato agreement when Washington said it intended to

withdraw from the deal.

The 17.09% antidumping duty is set at the percentage by

which exported Mexican tomatoes have been unfairly underpriced

in the United States, it said.

"For far too long our farmers have been crushed by unfair

trade practices that undercut pricing on produce like tomatoes,"

U.S. Commerce Secretary Howard Lutnick said.

Mexico's ministries of economy and agriculture said in a

joint statement the U.S. decision was "unfair" and against the

interests of Mexican producers and the U.S. industry.

The government said it would help local tomato producers

seek a deal to suspend the tomato duty as well as support them

in seeking new international markets.

Mexican tomato growers had offered proposals that were

positive for the U.S., but were rejected for "political

reasons," the statement added.

A group of five Mexican agriculture associations, including

from Baja California and Sinaloa states, said they were

committed to working with the Mexican government to find

solutions.

"There are no countries in the world that can replace

Mexican tomatoes in a market we have built through innovation

and effort over the past 120 years," they said in a statement.

HIGHER PRICES EXPECTED

Before Monday's announcement, some experts, as well as

Trump's opponents from the Democratic Party, warned that prices

of tomato products would rise.

"Salsa will be pricier, shelves emptier, and groceries more

expensive," U.S. Representative Sylvia Garcia said on X on

Friday.

Trump on Saturday separately threatened a 30% tariff on

Mexican imports starting August 1 after weeks of negotiations

with the country failed to reach a comprehensive trade deal.

U.S. growers have long sought protections from Mexican

competitors who can often grow the fruits year round.

The 2019 agreement was supposed to set a floor on pricing

and provided for U.S. border inspections of crops. But U.S.

growers have long argued that the arrangement had too many

loopholes that allowed for dumping of Mexican fruits.

"This decision will protect hardworking American tomato

growers from unfair Mexican trading practices and send a strong

signal that the Trump Administration is committed to ensuring

fair markets for American agriculture," Robert Guenther, an

official with the Florida Tomato Exchange, which represents

growers there.