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Price Analysis of Mexican Tomato Imports Are Antidumping Duties Warranted By Glenn C W Ames Jeffrey H Dorfman and Elisa Soares Abstract The U S fresh winter tomato market was analyzed using a six equation econometric model The estimated welfare impacts of a 50 increase in the tariff rate on Mexican tomato imports indicated that 67 of the loss in consumer welfare is transferred from domestic consumers to domestic producers as a gain in producers surplus The import price falls but the volume of imports declines only about 1 Tomato importers pay about 3 6 million in additional tariff revenue Paper presented at the Tri National Research Symposium NAFTA and Agriculture Is the Experiment Working San Antonio Texas November 1 2 1996 Price Analysis of Mexican Tomato Imports Are Antidumping Duties Warranted Tomato imports have been the center of many legal and political conflicts in international trade since the first case was decided by the U S Supreme Court in 1893 Bredahl et al 1987 p 5 Competing for the U S market are Florida producers and the Mexican growers situated in the State of Sinaloa and Baja California In calendar year 1995 U S tomato imports from Mexico rose to a record 1 31 billion pounds valued at 404 million a 58 increase in volume and a 29 increase in value over 1994 Since the peso devaluation of December 1994 imports from Mexico have captured significant additional market share 10 2 in quantity and 8 5 in value Table 1 In 1995 96 Florida growers blamed the reduction in trade barriers due to NAFTA for the recent surge in Mexican tomato imports which have allegedly depressed domestic prices profits and resulted in the loss of market share for Florida producers In the winter market Florida s market share fell from 59 in 1990 91 to 37 in 1995 The Wall Street Journal April 3 1996 p 1 During the 1995 96 early winter season tomato imports from Mexico jumped 24 in volume but only 2 in value compared to 1994 95 By February 12 1996 the winter tariff rate quota 177



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