Fresh Tomatoes from Mexico Investigation 731-TA-747 (Final) Publication 5003 December 2019 U.S. International Trade Commission Washington, DC 20436 U.S. International Trade Commission COMMISSIONERS Rhonda K. Schmidtlein Jason E. Kearns Randolph J. Stayin Amy A. Karpel Catherine DeFilippo Director of Operations Staffass igned Christopher W. Robinson Investigator Angelica Marrero-Sanchez, IndustryAnalyst JamesHorne, Economist JenniferBrinckhaus, Accountant Aaron Woodward, Statistician Brian Allen, Attorney Elizabeth Haines, Supervisory Investigator Address all communications to Secretary to the Commission United States International Trade Commission Washington, DC 20436 U.S. International Trade Commission Washington, DC 20436 www.usitc.gov Fresh Tomatoes from Mexico Investigation 731-TA-747 (Final) Publication 5003 December 2019 CONTENTS Page Determination ................................................................................................................................. 1 Views of the Commission ............................................................................................................... 3 Introduction ................................................................................................................ I‐1 Background ................................................................................................................................ I‐1 Subsequent five‐year reviews ............................................................................................... I‐3 The suspension agreements .................................................................................................. I‐8 Statutory criteria ..................................................................................................................... I‐11 Organization of report ............................................................................................................. I‐12 Market summary ..................................................................................................................... I‐12 Previous and related investigations ........................................................................................ I‐13 Summary data and data sources ............................................................................................. I‐14 Nature and extent of subsidies and sales at LTFV .................................................................. I‐15 Sales at LTFV ........................................................................................................................ I‐15 The subject merchandise ........................................................................................................ I‐16 Commerce’s scope .............................................................................................................. I‐16 Tariff treatment ................................................................................................................... I‐17 The product ............................................................................................................................. I‐17 Description and applications ............................................................................................... I‐17 Manufacturing processes .................................................................................................... I‐23 Domestic like product issues ................................................................................................... I‐28 Part II: Conditions of competition in the U.S. market ............................................................ II‐1 U.S. market characteristics ....................................................................................................... II‐1 U.S. purchasers ......................................................................................................................... II‐1 Channels of distribution ........................................................................................................... II‐2 Geographic distribution ........................................................................................................... II‐3 Supply and demand considerations ......................................................................................... II‐3 U.S. supply ............................................................................................................................ II‐3 U.S. demand ......................................................................................................................... II‐7 i CONTENTS Page Substitute products .............................................................................................................. II‐9 Substitutability issues ........................................................................................................... II‐9 Lead times ............................................................................................................................ II‐9 Knowledge of country sources ........................................................................................... II‐10 Factors affecting purchasing decisions............................................................................... II‐10 Importance of specified purchase factors .......................................................................... II‐11 Comparisons of domestic products, subject imports, and nonsubject imports ................ II‐13 Comparison of U.S.‐produced and imported fresh tomatoes ........................................... II‐16 Elasticity estimates ................................................................................................................. II‐18 U.S. supply elasticity ........................................................................................................... II‐18 U.S. demand elasticity ........................................................................................................ II‐19 Substitution elasticity ......................................................................................................... II‐19 Part III: U.S. producers’ production, shipments, and employment ....................................... III‐1 U.S. producers ......................................................................................................................... III‐1 U.S. producers’ acreage and production................................................................................. III‐8 U.S. producers' capacity, production, and capacity utilization ............................................... III‐9 U.S. producers’ U.S. shipments and exports ......................................................................... III‐17 U.S. producers’ consolidated U.S. shipments ....................................................................... III‐23 U.S. producers’ inventories ................................................................................................... III‐24 U.S. producers’ imports and purchases ................................................................................ III‐25 U.S. employment, wages, and productivity .......................................................................... III‐28 Part IV: U.S. imports, apparent U.S. consumption, and market shares ................................ IV‐1 U.S. importers.......................................................................................................................... IV‐1 U.S. imports ............................................................................................................................. IV‐3 Negligibility ............................................................................................................................ IV‐17 Apparent U.S. consumption and U.S. market shares ............................................................ IV‐18 ii CONTENTS Page Part V: Pricing data ............................................................................................................... V‐1 Factors affecting prices ............................................................................................................ V‐1 Raw material costs ............................................................................................................... V‐1 U.S. inland transportation costs ........................................................................................... V‐1 Exchange rates ...................................................................................................................... V‐1 Pricing practices ....................................................................................................................... V‐2 Pricing methods .................................................................................................................... V‐2 Sales terms and discounts .................................................................................................... V‐3 Price leadership .................................................................................................................... V‐4 Price data .................................................................................................................................. V‐5 Price trends ......................................................................................................................... V‐19 Price comparisons .............................................................................................................