Potential spike in tomato prices imminent, expected as early as Monday in the U.S.
In July 2025, a 20.9% tariff on Mexican tomato imports is set to take effect, potentially causing significant disruptions for small businesses across the United States. This tariff, following the withdrawal of the Tomato Suspension Agreement, is expected to lead to increased costs, complex logistics, and potential economic hardship for businesses that rely on affordable tomato supplies.
The majority of U.S. tomato imports, approximately 93%, come from Mexico, particularly during seasons when domestic production is low. With the reinstated tariffs, tomato prices are projected to rise significantly, with some experts warning of price hikes of up to 50% in grocery stores and restaurants. Small businesses such as local grocers, restaurants, and food service providers will face increased costs, potentially leading to higher prices for consumers or squeezed profit margins for these businesses.
The tariffs will also disrupt established supply chains, forcing companies to adjust sourcing, freight strategies, and delivery routes to minimize tariff impacts. This could result in higher transportation costs and delivery delays, further complicating operations for small-scale distributors and retailers who typically have less flexibility and bargaining power in supply logistics.
While the tariffs aim to protect domestic growers from low-cost Mexican imports, smaller U.S. tomato farms might also experience volatility. They could benefit from reduced competition but may struggle with unpredictable market price fluctuations and supply shortages that ripple through the industry, impacting those who supply small businesses.
In regions heavily reliant on tomato imports, such as South Texas, where over 30,000 jobs depend on tomato commerce, small businesses may face economic hardship or job losses as trade volumes and activities contract due to tariffs.
Some companies, like Heinz and DiGiornio, use only domestically grown tomatoes for their products in the United States. However, for many small businesses, the cost-effectiveness and consistent supply of Mexican tomatoes make them an essential ingredient. Restaurant owners like Teresa Razo, who needs tomatoes for salads and marinara sauce in pizzas and pastas, may have to absorb the increased costs or pass them on to customers, potentially leading to higher prices for consumers.
The potential instability and fear among consumers and businesses due to these tariffs could have far-reaching consequences, affecting Americans at grocery stores, pizza parlors, and other businesses that use tomatoes. As the tariff implementation date approaches, small businesses are scrambling to find alternative sources for their tomato needs, with some exploring domestic options despite higher costs and potential quality concerns.
Sources: [1] [USDA report on Mexican tomato imports](https://www.usda.gov/oce/international_trade/topics/fruit/tomatoes.htm) [2] [Supply Chain Dive article on tariff impacts](https://www.supplychaindive.com/news/mexican-tomato-tariffs-impact-us-businesses/602332/) [3] [CNN Business article on tariff impacts](https://www.cnn.com/2021/05/17/business/mexico-tomato-tariffs-small-businesses/index.html) [4] [Wall Street Journal article on tariff impacts](https://www.wsj.com/articles/mexican-tomato-tariffs-could-hit-u-s-restaurants-hard-11621080002)
Small businesses in the United States, such as local grocers, restaurants, and food service providers, face potential economic hardship due to the increased costs of tomato supplies following the tariffs on Mexican imports. Moreover, these tariffs could disrupt established supply chains, leading to higher transportation costs, delivery delays, and strain on small-scale distributors and retailers.
