Mexican tomatoes could go up 20% by July if no deal is reached

PHARR, Texas (ValleyCentral) — The Department of Commerce's decision to terminate the tomato suspension agreement has prompted local officials and companies to voice their concerns.

This is because the industry brings over $8.3 billion to the United States with the Rio Grande Valley being one of the regions who benefits the most. A 20% tariff on Mexican tomatoes entering the United States is expected to take effect in July if no deal is reached.

“Tomatoes is big business for them," said Dante Galeazzi, who is the CEO and president of the Texas International Produce Association. "It's big business for us. It's big business for Texas. It's big business for the United States. If this agreement goes away, our state is going to suffer. Our region will pay the price.”

Several business owners from different industries today also say rising prices could have a devastating impact on the local economy. Oscar Castillo is part owner of La Lomita restaurant in Pharr and says that they go through four to eight 40 pound boxes of tomatoes weekly.

“We do use the tomato on basically everything," Castillo said. "If all those prices start creeping up then we don’t have anything to do about it. It is going to affect us because we can’t be increasing prices every week or every month.”

An increase in prices will affect their profit and employees.

“We could lose business and if we lose business then we have to take days off from the workers and you know trying to balance out things for us to keep business," Castillo said.

Restaurants won’t be the only ones impacted. The trucking industry will take a hit as Relvic Trucking Owner Victor Romero says this can disrupt routes they already across the country.

"If our customer fills one truck with ten pallets of tomatoes, six with tomatillos, and another product, what if there are no tomatoes available, they’ll have to look elsewhere — and that’s where the impact is felt," Romero said. "How are you going to fill that gap? So, it's something we in the logistics area have to be prepared for."

The City of Roma also sees 200 commercial trucks crossing daily with 60% of those crossing tomatoes from Mexico. Roma City Manager Alejandro Barrera says this caused them to develop an industrial park that has helped the local economy thrive.

"We are 40% sold of our industrial park and 90% of the lots will be for cold storage warehouse which is the product industry," Barrera said. "Imagine, you take away thousands of crossings per year its going to affect our industrial park and economic development.”

The tomato agreement is revised every five years and its last update was in 2019 with a review pending last year in 2024. The Department of Commerce has 90 days to reach and agreement or do away with it.

Romero and others say a balanced solution is possible.

"I believe there should be a fair regulation regarding the timing of Mexican products entering the market, aligning it with Florida's harvest season," Romero said. "It’s also important to establish fair pricing agreements so that both sides benefit. This way, domestic products can compete with Mexican ones under fair conditions in terms of both price and quality."

Romero adds that he continues to have meetings with trading partners to prepare for the potential tariffs. However, he doesn’t believe the suspension will happen.