This browser does not support the Video element.
The price people pay for tomatoes could skyrocket when an agreement between the U.S. and Mexico over the price of tomatoes ends Tuesday night.
The tomato suspension agreement also eliminated a tax placed on every box brought to the country. If the pricing agreement goes away, the 18 percent tomato tariff comes back.
Avila's Mexican restaurant serves homestyle Tex-Mex meals on Maple Avenue in Dallas and management follows food costs closely.
“The basis of pretty much every Mexican dish is pico de gallo, which is onion, cilantro, tomato and jalapeño so at the root of every single dish we pretty much use tomatoes,” Avila’s Trent Marrs.
Distributors are also warry of what could happen to tomato prices.
“I’m buying as much as I can right now and putting them in our warehouse in the valley and bringing what I can up here,” said Mason Odom, Premier Produce. “University of Arizona has estimated that tomatoes will rise 38 to 70 percent in costs at the retail level.”
The Commerce Department plans to withdraw from an agreement with Mexico on May 7. The deal has been in place sent 1996 and was last ratified in 2013.
It stopped an investigation into whether Mexico was undercutting U.S. tomato producer prices and eliminated a long time tomato tariff.
Commerce Secretary Wilbur Ross says the U.S. is withdrawing to protect American tomato growers from unfair trade practices.
Going forward, there will be nearly an eighteen percent tax on every 25-pound box of tomatoes imported from Mexico.
“We cross just through the Texas valley $1 billion a year of tomato nationwide through Arizona. Texas and California, $3 billion,” Odom said.
That means hundreds of millions annually in a potential tomato tariff.
“It’s staggering and that price gets pushed all the way down to the consumer,” Odom said.