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FACT SHEET
Termination of Agreement Suspending an Antidumping Investigation on
Imports of Fresh Tomatoes from Mexico


On May 31, certain Mexican tomato growers withdrew from a suspension agreement on imports of fresh tomatoes, thereby terminating the agreement, effective July 30, 2002. With the termination of the agreement, the Department of Commerce ("the Department") will reactivate the underlying antidumping ("AD") investigation and will instruct the U.S. Customs Service ("Customs") to require antidumping duty deposits for entries made on or after July 30, 2002.
The Department will reactivate the investigation from the time of the preliminary determination, originally published on November 1, 1996. Customs will require deposits based on the preliminary antidumping margins which range from 4.16 to 188.45 percent. Antidumping margins for individual Mexican producers/exporters are listed below.

Background:
On April 25, 1996, the Department initiated an antidumping investigation on imports of fresh tomatoes from Mexico. On November 1, 1996, the Department published its preliminary determination and its notice of an agreement to suspend the antidumping investigation. The terms of the suspension agreement between the Department and producers/exporters accounting for substantially all imports of fresh tomatoes from Mexico were that each signatory producer/exporter agreed to revise its prices to eliminate completely the injurious effects of exports of this merchandise to the United States.
With the termination of the agreement, the Department will reactivate the investigation, and is currently scheduled to make its final determination on December 12, 2002. If the Department makes a final affirmative determination, then the International Trade Commission ("ITC") is scheduled to make its final injury determination on January 27, 2003. If both the Department's and the ITC's final determinations are affirmative, the Department will issue an antidumping order. For further background, see the attached questions and answers section.

Product Description:
The products covered by this investigation are all fresh or chilled tomatoes except for cocktail tomatoes and those tomatoes which are for processing. For purposes of this investigation, cocktail tomatoes are greenhouse-grown tomatoes, generally larger than cherry tomatoes and smaller than Roma or common round tomatoes, and are harvested and packaged on-the-vine for retail sale. For purposes of this investigation, processing is defined to include preserving by any commercial process, such as canning, dehydrating, drying, or the addition of chemical substances, or converting the tomato product into juices, sauces, or purees.

Tomatoes imported from Mexico covered by this investigation are classified under the following subheadings of the Harmonized Tariff Schedules of the United States, according to the season of importation: 0702.00 and 9906.07.01 through 9906.07.09

Preliminary Antidumping Duty Margins:
Company
Antidumping Margins
San Vicente Camalu
4.16%
Ernesto Fernando Echavarria Salazar Grup Solidario
11.89%
Arturo Lomeli Villalobas S.A. de C.V.
26.97%
Eco-Cultivos
45%
Ranchos Los Pinos S. de R.L. de C.V.
10.26%
Administradora Horticola del Tamazula
28.30%
Agricola Yory, S. de P.R. de R.I.
11.95%
All Others
17.56%


Case Calander:
Event
Date
Initiation April 25, 1996
Department's Preliminary Determination November 1, 1996 (published)
Notification of Suspension Agreement November 1, 1996 (published)
Department's Final Determination December 12, 2002 (fully extended)
ITC Final Determination* (estimate) January 27, 2003 (fully extended)
Issuance of AD Order** (estimate) February 3, 2003 (fully extended)
* If either the Department or the ITC make a negative final determination, the investigation is terminated.
**An AD order will be issued only in the event of final affirmative determinations by the Department and the ITC.


Import Statistics:
  1996 1997 1998 1999 2000 2001
Value ($) $580,348,521 $517,048,769 $567,442,691 $489,587,610 $411,795,805 $484,922,820
Quantity (MT) 685,678 660,609 734,053 615,064 589,954 679,187
Source: Dataweb, ITC.

 

Question: When was the Agreement on tomatoes from Mexico put into place?
Answer: On November 1, 1996, the Department published a notice in the Federal Register announcing that it had reached an agreement to suspend the antidumping investigation on fresh tomatoes from Mexico.
Question: What was the purpose of the Agreement?
Answer: Under the Agreement, signatory growers/exporters of Mexican fresh tomatoes agreed to sell their merchandise in the United States at or above a minimum reference price. The reference price was intended to eliminate injury to the U.S. industry by preventing price suppression and the undercutting of prices in the U.S. market by low-priced Mexican imports.
Question: When did the Mexican growers withdraw from the Agreement? When will termination of the Agreement become effective?
Answer: On May 31, 2002, certain Mexican tomato growers withdrew from the Agreement. As a result, the Agreement terminates on July 30, 2002 (60 days after the notification of withdrawal, as stipulated in the terms of the Agreement).
Question: Why did the Mexican growers withdraw?
Answer: It appears that they were most concerned with whether there would continue to be sufficient participation in the Agreement and with the manner in which the Agreement was being enforced.
Question: What are the consequences for Mexican growers and importers of fresh tomatoes from Mexico?
Answer: With the termination of the Agreement, the Department will reactivate the investigation from the time of the preliminary determination. Therefore, the Department will instruct the U.S. Customs Service to require cash deposits or bonds on entries of the subject merchandise on or after July 30, 2002, based on the preliminary antidumping margins which range from 4.16 to 188.45 percent.
Question: When will the Department complete the investigation?
Answer: The Department is currently scheduled to make its final determination on December 12, 2002. If the Department makes a final affirmative determination, then the International Trade Commission is scheduled to make its final injury determination on January 27, 2003. If both the Department and the International Trade Commission reach affirmative final determinations, the Department will issue an antidumping order.
Question: Was the Agreement on tomatoes from Mexico successful?
Answer: Generally, the Agreement fulfilled its purpose and was a successful alternative to an antidumping order. Representatives of the U.S. industry have noted that the Agreement helped reduce the suppression of prices of domestic fresh tomatoes.
Question: When the Department restarts the antidumping duty investigation, will the ongoing sunset review of the Agreement be terminated?
Answer: It seems likely. However, the Department is still reviewing how termination of the Agreement will affect the sunset review.
Question: Can the Department negotiate another Agreement?
Answer: Yes. If the Mexican producers/exporters make such a request, we can attempt to negotiate another Agreement.

 

 

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