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SAN ANTONIO – Tomato prices could increase as much as 40% to 80% this year if the U.S. Department of Commerce withdraws from the Tomato Suspension Agreement by May 7. This will affect Texas consumers and the produce industry significantly, according to experts.
Industry leaders were updated on the implications at the Texas International Produce Association Viva Fresh Show in San Antonio. The agreement sets a price minimum, or price floor, for imports and provides other protective trade measures.
Dr. Luis Ribera, Texas A&M AgriLife Extension Service economist, College Station, was part of a media briefing at the show. Ribera said 52% of Mexican tomatoes come through Texas.
“About 41 percent are shipped through Pharr and another 11 percent through Laredo,” he said. “This could impact the 8,000 jobs here in Texas that support fresh produce imports from Mexico. This would include everything from packers, brokers, transportation, anything and everything that supports this important industry that gets tomatoes from market to the retailer.”
“This makes no sense,” said Lane Jungmeyer, president of the Fresh Produce Association of the Americas, based in Nogales, Ariz., in a statement. “Most Americans crave certain kinds of vine-ripened tomatoes, and now they are going to have to pay more, significantly more.”
A study conducted by economists at Arizona State University finds that during other periods, such as winter, prices for certain varieties like vine-ripened tomatoes, tomatoes on the vine and Romas could rise more than 85%, according to an analysis, which relies on data from AC Nielsen.
Dramatic price increases could have far-reaching impacts, Ribera said. He said consumers accustomed to dining at Mexican food restaurants and enjoying fresh salsa with chips and guacamole could pay higher prices.
“The question is are we going to get used to a restaurant not having fresh salsa?” Ribera said. “Or are we going to be going to a restaurant and having not-so-fresh salsa, say something that is prepackaged? When we dine at a Mexican restaurant, we have come to expect fresh salsa with chips and guacamole. Will these restaurants start charging more? We really don’t know yet.”
Ribera said U.S. consumers spend 6.3% of their annual income on food. That could rise if tomato prices escalate. Consumers might also have to “pay up” for other varieties of tomatoes to have a fresh product available on the dinner table.
Beefsteak and Roma tomatoes are consistent favorites among Texas consumers. If there is a shortage, consumers will be seeking alternatives, such as homegrown tomatoes where available.