Between the Grammy huckstering and all the Pontiff pontification, you may have missed this little item – the US and Mexico have cut a trade deal where the price of imported tomatoes will double, and the case of some speciality tomatoes like cherries, the price will soar higher. The official line is that this will “avert a trade war by halting the re-instigation of anti-dumping investigations.”
Fine. What it means is that Obama’s Commerce Department has yet again stuck it to the middle class with higher food costs at the expense of making a very very important voting block in Florida of wealthy tomato growers very happy. And rich.
To quote (either the New York Times or Wall Street Journal – so this comes from both sides of the spin fence):
The Cato Institute’s Daniel Ikenson estimates that winter tomato prices could rise from 41% to 168%, and summer prices 47% to 176%. Specialty tomatoes, such as grape, cherry or heirloom varieties, will see the biggest increases.
In essence, the US has agreed to let Mexico increase the minimum price they charge for tomatoes, called the “price floor”. I don’t know why it’s called that. I’m sure some accounting MBA thought it up in order to make it sound important. It’s a minimum price.
Another little sideline – Mexico employes about 350,000 workers in the tomato industry. I’m sure a few of those folk will be seeing pink slips now that quantity is no longer the issue.
Here is the solution proposed by one blog commenter from California:
How about we all( Mexican And US growers) stop growing so many tomatoes. Let a market be a real market and we wont have to worry minimums.
And from an article in Forbes:
Not only will consumers pay more for foreign and domestically grown tomatoes at the grocery store and for salads and hamburgers at restaurants, but the new price-floor terms provide a strong indication that the specter of uncertainty associated with antidumping administration provides the necessary leverage to induce foreign producers into pricing schemes indistinguishable from collusion and price-fixing.
Get those tomatoes planted early this year….