As Mexican tomato exports increase worldwide, including the United States, prices for U.S. farmers, including Florida, are falling. Historically, new research from the University of Florida shows that if imports from Mexico increase by 50 percent over the next few years, it could earn US farmers $ 252 million a year – or 27 percent.
This is a huge loss for U.S. farmers who produced 1.3 billion pounds of fresh tomatoes by 2020, less than a third of the 2000 crop.
As Mexico increases worldwide tomato exports, prices for U.S. farmers, including Florida, fall.
Zhengfi Kuan, associate professor of food and resource economics at the UF Food and Agricultural Science Institute, said the decline in U.S. tomato exports was due to Mexico and other challenges.
Quan published a study on the impact of intensifying Mexican competition on American farmers. The market conditions of the Mexican and domestic tomato industry have completely changed in the last 20 years. Mexico now dominates the U.S. market, with three times the market share of domestic industry. That change sparked Guan’s interest in pursuing a new study.
“Recently there have been a series of trade disputes between the two countries over fruits and vegetables,” he said. “One reason is that imports from Mexico are rising, subsidies are rising, prices are falling and American farmers are rapidly losing market share.
“The findings of our study will provide tomato growers and policymakers with important insights into the challenges and sustainability of the American tomato industry,” Quan said.
In his study, Quan measured the potential losses to the U.S. sector as a result of increased imports from Mexico. As a rule of thumb, the amount of tomatoes imported from Mexico increased by about 60 percent between 2009-2019.
Zhengfi Quan’s study measured the potential loss to the US industry due to increased imports from Mexico.
The results of Guan’s research show that domestic tomato prices are particularly sensitive to imports from Mexico in a highly saturated market.
Imports are particularly damaging to the Florida tomato industry, with sales of about $ 400 million and the same harvest seasons in Mexico. West-Central, Southwest and Southeast Florida are the largest tomato growing areas in the state of Sunshine.
The trade shortage is not just a problem for tomatoes – it is a problem for farmers and horticulturists of various commodities. According to the U.S. Department of Agriculture, fruits and vegetables such as tomatoes, strawberries, peppers, cucumbers and melons account for 50 percent of total Mexican horticultural imports to the United States by 2020.
“But not all will be lost if the American fruit and vegetable industries revolutionize production technology,” Quan said. “Mechanization or automation will be a game changer and the future of this labor-intensive industry.”
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