On September 17th, the U.S. Dept of Commerce released their preliminary determination with regards to the potential reinterpretation of the FOB pricing in the 2019 Tomato Suspension Agreement. In brief, the preliminary determination appears to agree to with TIPA’s position on the following:
1. The phrase “FOB U.S. shipping point” refers to the point of shipment from a selling agent warehouse or in/out facility near the U.S.-Mexico border on the United States side;
2. For FOB sales, the price to the first unaffiliated U.S. customer may include all expenses up to the U.S. shipping point (i.e., the selling agent’s warehouse or the in/out facility); and
3. For delivered sales, the price must include all expenses after shipment from the selling agent warehouse or the in/out facility near the border.
This determination is very positive, but as noted it is only preliminary. There will be another round of comments before the final determination is issued. We will continue to monitor the progress on this issue and report back. Our thanks to all the industry and affiliated industry partners who support this effort!!
