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December 11, 2020
Seasonal Fruit and Vegetable Competition in U.S.-Mexico Trade
As part of the United States-Mexico-Canada Agreement
products in AD/CVD proceedings, making it easier for a
(USMCA) negotiation, the United States attempted to
group of regional producers to initiate an injury case and to
resolve ongoing trade imbalances with Mexico for seasonal
prove injury, thereby resulting in AD/CVD duties on the
and perishable fruits and vegetables through rule changes to
imported products responsible for the injury. The approach
U.S. trade laws. The Trump Administration had hoped such
embodied in the U.S. proposal could have protected some
changes could make it easier to initiate trade remedy cases
U.S. seasonal produce growers by making it easier to
against (mostly Mexican) exports to the United States and
initiate trade remedy cases. The U.S. International Trade
would respond to complaints by some fruit and vegetable
Commission (USITC) has previously reviewed trade
producers, mostly in southeastern U.S. states, who claim to
remedy cases involving perishable produce—such as Fall-
be adversely affected by import competition from Mexico.
harvested Round White Potatoes from Canada and Spring
Several Members of Congress from these states have
Table Grapes from Chile—that proved difficult to settle.
supported such actions. However, USMCA, which came
into force in 2020, did not include seasonal produce
As ratified, USMCA did not include changes to U.S. trade
protections. Instead, the Trump Administration initiated a
remedy laws to address seasonal produce trade. At a July
series of trade remedy and fact-finding investigations.
2019 congressional hearing, U.S. Trade Representative
(USTR) Robert Lighthizer indicated that attempts to
U.S. Fruit and Vegetable Trade Situation include such provisions were not successful, citing
The United States has gone from being a net exporter of
opposition by Mexican negotiators.
fresh and processed fruits and vegetables in the early 1990s
to being a net importer of fruits and vegetables today (see
Figure 1. Global U.S. Fruit and Vegetable Trade
Figure 1). In 2019, the gap between total U.S. imports and
exports of fresh and processed fruits and vegetables
(excluding nuts and bananas) totaled nearly $20 billion.
Mexico accounts for nearly half of the value of U.S. fruit
and vegetable trade with the United States. In 2019, U.S.
imports of fresh and processed fruits and vegetables from
Mexico amounted to $15.6 billion, while U.S. exports to
Mexico totaled $1.4 billion, resulting in a trade deficit of
$14.1 billion in these products (excluding nuts and bananas)
(see Figure 2). Several factors have contributed to this
trade imbalance, including relatively open and free trade
between the United States and Mexico and increased year-
round demand for fruits and vegetables and counter-
seasonal import supplies, which have benefitted U.S.
Source: CRS from data in the USITC’s Trade DataWeb database.
consumers. Production of some Mexican fruits and
Note: Fresh and processed products (Harmonized Tariff Schedule
vegetables—tomatoes, peppers, berries, cucumbers, and
[HTS] chapters 07, 08, and 20, excl. nuts, bananas [HTS 0801-0803]).
melons—has increased in recent years in part due to
Mexico’s investment in large-scale greenhouse facilities
Figure 2. U.S.-Mexico Fruit and Vegetable Trade
and technological innovations, which some claim has been
supported by the Mexican government and should be
subject to antidumping and countervailing duties
(AD/CVD) proceedings on U.S. imports. Trade concerns by
growers in Florida and Georgia have primarily centered on
imported tomatoes, peppers, and berries (see Figure 3).
Efforts in USMCA Negotiation
The Trump Administration attempted to resolve concerns
about this trade imbalance with Mexico through the
USMCA negotiation. U.S. agriculture-related objectives in
the USMCA negotiation included a proposal to establish
new rules for seasonal and perishable fruits and vegetables.
The U.S. proposal would have established a separate
domestic industry provision for perishable and seasonal
Source: CRS from data in the USITC’s Trade DataWeb database.
https://crsreports.congress.gov
Seasonal Fruit and Vegetable Competition in U.S.-Mexico Trade
Note: Fresh and processed products (HTS chapters 07, 08, and 20,
investigations, among other actions. Separately the
excl. nuts, bananas [HTS 0801-0803]).
Department of Commerce is developing regulations to
Figure 3. U.S. Imports of Mexican Produce, 2019
improve the administration and enforcement of AD and
CVD laws (85 Federal Register 49472).
Section 201 Blueberry Investigation
USTR has requested that USITC open a global safeguard
investigation into blueberry imports under Section 201 of
the Trade Act of 1974 (19 U.S.C. §§2251-2254). A Section
201 investigation (or Global Safeguard Investigation) refers
to trade remedy actions designed to provide temporary
relief for a U.S. industry (e.g., additional tariffs or import
quotas) to facilitate adjustment of the industry to import
competition. Some Members of Congress have further
requested that the Section 201 blueberry investigation
include both cultivated and wild frozen blueberry imports.
Source: CRS from data in the USITC’s Trade DataWeb database.
USITC initiated its Section 201 blueberry investigation in
Note: Fresh and processed products (HTS chapters 07, 08, and 20,
late September and has since determined that such an
investigation is “extraordinarily complicated.”
excl. nuts, bananas [HTS 0801-0803]).
Support and Opposition to Proposal
Section 332 General Fact-Finding Investigations
USTR also has requested an investigation by USITC “to
Views regarding seasonal produce protections in trade
monitor and investigate imports of strawberries and bell
agreements are mixed. Although most lawmakers from
peppers, which could enable an expedited Section 201
Florida and Georgia called on USTR to include seasonal
global safeguard investigation.”
protections in USMCA, others in Congress opposed such
changes, contending that seasonal imports complement
In December, USITC launched two general fact-finding
rather than compete with U.S. growing seasons. Legislation
investigations of strawberries and bell peppers under
seeking changes to U.S. trade laws to address seasonal
Section 332 of the Trade Act of 1930 (19 U.S.C. §1332), as
produce protections were part the Defending Domestic
requested by USTR. Under a Section 332 general fact-
Produce Production Act of 2019 (S. 16; H.R. 101), as
finding investigation, USITC may investigate a wide
reintroduced in the 116th Congress from the 115th Congress.
Others worried it could open the door to an “uncontrolled
variety of trade aspects of any matter involving tariffs or
international trade, including conditions of competition
proliferation of regional, seasonal, perishable remedies
against U.S. exports.”
between the United States and foreign industries. In
Still others, such as the Fresh
November, some Members of Congress from Georgia asked
Produce Association of the Americas, claimed that such
efforts would favor a few “poli
that USTR further request that USITC also conduct a
tically-connected, wealthy
agribusiness firms from Florida” at the expense of others in
Section 332 investigation of cucumbers and squash.
the U.S. produce industry and at the expense of both
Other Requested Investigations
consumers and growers in other fruit and vegetable
At the August 2020 hearings, other industry stakeholders
producing states, such as California. At a 2017 House
recommended trade remedy investigations involving other
Agriculture Committee hearing, lawmakers from California
types of crops, including tomatoes and pecans. Mexican
and other states highlighted the benefits of produce imports
restrictions on U.S. potato exports also remain a concern.
from Mexico to both U.S. consumers and the U.S. fruit and
Also at the hearings, some Members of Congress and
vegetable industry.
industry groups who testified asked that USTR launch an
investigation of Mexican trade practices and policies
Most U.S. food and agricultural sectors, including some
involving seasonal and perishable produce under Section
fruit and vegetable producer groups, opposed including
301 of the Trade Act of 1974 (19 U.S.C. §§2411-2420). To
seasonal protections in USMCA. Some worried that efforts
date, USTR has not initiated such an investigation.
to push for seasonal protections would derail the
renegotiation altogether. The Agricultural Technical
Advisory Committee for Trade in Fruits and Vegetables
CRS Products
(F&V ATAC), which advised USTR on behalf of the
CRS Report RL34468, The U.S. Trade Situation for Fruit and
industry, also did not support including seasonal provisions
Vegetable Products
in the USMCA negotiation. In January 2018, F&V ATAC
further voted to withdraw the seasonal and perishable trade
CRS Report R45038, Efforts to Address Seasonal Agricultural
remedy proposal from the U.S. negotiating objectives.
Import Competition in the NAFTA Renegotiation
CRS Report R46242, Major Agricultural Trade Issues in 2020
Ongoing Efforts
CRS In Focus IF10786, Safeguards: Section 201 of the Trade Act of
Efforts to enact trade remedies on seasonal and perishable
1974
produce continue. Hearings held by USTR in August 2020
highlighted concerns on both sides of this issue. USTR
released its plan for seasonal and perishable produce in
Renée Johnson, Specialist in Agricultural Policy
September 2020, which initiated certain U.S. trade remedy
https://crsreports.congress.gov
Seasonal Fruit and Vegetable Competition in U.S.-Mexico Trade
IF11701
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