Three Storms at Once: What El Niño, the Antidumping Tariff, and the Peso Are Doing to Mexican Produce Growers

Most growing seasons bring one major challenge. Mexican produce growers are navigating three simultaneously.

A 17% antidumping tariff on tomato exports to the United States, in place since July 2025. A peso that gained 14% against the dollar in 2025 and is still running 2% higher into 2026, quietly eroding every dollar-denominated contract. And now, a Super El Niño event that forecasters describe as potentially the strongest in living memory — landing in the second half of 2026 exactly when northern Mexico’s key growing regions are most vulnerable.

None of these pressures is new on its own. What’s new is their convergence — on top of drought carryover from 2025 that growers haven’t fully recovered from. The result is a season that requires more planning, more capital, and more resilience than any in recent memory.

Here is what’s happening, what the data shows, and what growers on the ground are doing about it.

What happened and where things stand

In July 2025, the U.S. government terminated the 2019 Tomato Suspension Agreement and imposed a 17.09% antidumping duty on most Mexican fresh tomato imports. The order followed the Court of International Trade’s April 2025 ruling sustaining the Commerce Department’s antidumping investigation.

Mexican producers — led by the Bioparques Group and supported by a broad coalition including NatureSweet, Mastronardi Produce, the Asociación Mexicana de Horticultura Protegida, and the Fresh Produce Association of the Americas — challenged the order through a Changed Circumstances Review at the U.S. International Trade Commission. On June 30, 2026, the commission voted 2–0 to affirm the order, with the Chairman recused. The antidumping duties remain fully in force.

The ripple effects are significant and compounding. Mexico’s 2026 tomato production is forecast at 2.6 million metric tons — a 9% decline from 2025, following a 3% decline the year before, part of a downward trend that began in 2023. Exports to the U.S. are projected to fall 9% to 1.8 million metric tons — and the U.S. still accounts for over 90% of Mexico’s exportable tomato supply, meaning no meaningful alternative market can absorb the lost volume. Planted acreage is down 11% to approximately 93,900 acres, with a pronounced shift away from open-field systems toward protected greenhouse production.

What the tariff is actually costing — beyond the 17%

The duty rate is the headline. The full cost picture is wider.

Every shipment now carries compliance and certification overhead that didn’t exist under the Suspension Agreement. USMCA compliance requirements have tightened, adding documentation, customs bond, and certification costs to each cross-border transaction. A December 2025 scope clarification from the U.S. Department of Commerce added certification requirements specifically for fresh tomatoes imported for processing — another administrative layer with a direct cost attached.

One of those costs is the export bond requirement that came with the new antidumping order. What’s worth adding is that relief exists: AMHPAC worked directly with Mexico’s Secretary of Finance and FIRA — the country’s agricultural development bank — to implement a subsidized export bond support program specifically for tomato producers. The program is already operating. For smaller operations that would otherwise be shut out of the U.S. market by bond costs alone, this is a meaningful intervention — but accessing it still requires navigating a government program on top of an already complex compliance environment.

►  Source: Dirección de Ejecución y Cumplimiento, AMHPAC (2026)

Logistics costs have risen alongside compliance costs. Growers and exporters are absorbing the expense of rapid contract renegotiations, tighter delivery windows, and, in some cases, shipment rejections that were not a feature of trade under the prior agreement. When a tariff issue arises while cargo is already in transit, the financial consequences are difficult to reverse.

The shift to protected production — the sector’s primary structural adaptation — is itself a significant capital expenditure. Greenhouses carry higher energy costs for climate control, higher technology costs for automation and monitoring systems, and higher upfront investment requirements before a single box ships. In a season where margins are already compressed from two other directions — the peso and El Niño — the capital required to adapt is landing at exactly the moment it is hardest to access.

There is also a forward-looking cost that doesn’t yet appear on any invoice: the administrative review. The U.S. Department of Commerce is currently evaluating the actual dumping margin for individual Mexican exporters for the period July 14, 2025 through June 30, 2026. The result of that review could raise or lower duty rates on a company-by-company basis. AMHPAC has briefed its membership extensively on the implications and urged each exporter to decide whether to participate. For growers and exporters weighing that decision right now, the review adds a layer of financial uncertainty on top of everything else — because the rate they are paying today may not be the rate they will owe when the review concludes.

►  Source: Dirección de Ejecución y Cumplimiento, AMHPAC (2026)

And then there is the cost of uncertainty itself. Mexico’s tomato industry recorded its weakest August in five years immediately after the Suspension Agreement ended. Growers who would have expanded planting held back. Buyers who would have committed to larger orders hedged. The planning horizon the Suspension Agreement once provided — imperfect as it was — has been replaced by quarterly uncertainty, and uncertainty has a cost even when it doesn’t show up on an invoice.

The tariff is permanent for now — but not necessarily forever. AMHPAC is actively developing proposals to present to the U.S. Trade Representative, analyzing what Mexico could offer in exchange for ending the 17.09% duty and reaching a new bilateral agreement. The Changed Circumstances Review may be closed, but the diplomatic and legal work continues. For investors reading this, that matters: the tariff environment could shift, and Mexican producers who have adapted structurally—through greenhouse investment, precision technology, market diversification, and compliance infrastructure—will be best positioned to capture upside if and when that shift comes.

What it means beyond tomatoes

The tariff’s impact isn’t contained to tomatoes. The uncertainty it created has contributed to broader consolidation across the sector. Smaller operations are exiting open-sky production due to weather uncertainty, export market instability, and economic pressure. The reduction in export volume has also reduced the buffer for Mexico’s domestic market — consumer prices for standard Saladette tomatoes rose more than 100% year-over-year in 20 states as of April 2026.

For berry growers, the tariff itself doesn’t apply. But the broader environment it created—uncertainty about U.S. trade policy, margin pressure, and shifting market dynamics—has affected planning across the entire Mexican fresh produce export sector.

Berry exports are still growing, up 2% in 2026 to approximately 715,000 tons, but pricing and financing pressures persist even in a sector that’s expanding.

A hidden margin problem

The antidumping tariff is visible and dramatic. The peso story is quieter but hits just as hard.

Mexican tomato exports typically enter the U.S. market through negotiated contracts denominated in U.S. dollars. When the peso strengthened 14% in 2025 and a further 2% through April 2026, every dollar that came back from a U.S. buyer was worth fewer pesos by the time it cleared. On a fixed-price dollar contract, growers couldn’t adjust. The buyer’s price didn’t change. The revenue that arrived in Mexico did.

The combined effect of the tariff and the peso created a margin squeeze from both ends: dollar revenue fell due to tariff-related volume loss and contract pressure on one side, and the peso value of every dollar received fell on the other. Industry sources report that this combination has led to market consolidation and prompted some growers to transition to other crops entirely.

The season growers are walking into

Mexico is entering what forecasters describe as one of its hottest summers in history. The combined influence of El Niño, the canícula (the traditional dry period between July and August), and ongoing climate change effects has produced severe drought forecasts for the country’s northern, northwest, and northeast regions.

Northern and central Mexico — Chihuahua, Sonora, Sinaloa, Durango — consistently experience reduced summer rainfall during El Niño years. During strong events, the subtropical jet stream shifts southward, drying out these regions during the growing season. During strong El Niño winters, the northwest — Baja California and Sonora’s coastal plain — can swing the opposite direction, receiving 150–200% of normal rainfall from the same jet stream shift. For growers, the risk is real in both directions: drought during the summer growing season, flooding during winter production.

This arrives on top of drought conditions that growers are still carrying from 2025. Persistent drought throughout 2024 and early 2025 in northern and northwestern berry-producing areas led to tighter irrigation controls and heightened competition for water. Starting in June 2025, increased rainfall improved national reservoir levels and reduced the overall drought footprint by early 2026 — but that relief is not driving expansion. Growers are rebuilding buffers, not taking on more risk.

The specific risks by region and crop:

→  Sinaloa (tomatoes, berries): The region the industry is most concerned about. A Super El Niño event could severely compromise protected greenhouse production through summer drought and extreme winter rainfall. Disease pressure — particularly fungal and bacterial outbreaks from high humidity during flowering — is the specific risk that keeps growers up at night. Disease pressure in Sinaloa already forced the 2025–26 berry season to end early.

→  Jalisco and Michoacán (berries): Mexico’s blackberry heartland, producing 90% of the national crop between them. Heat stress and altered rainfall patterns during El Niño years affect berry sizing and harvest timing. These regions’ production is critical to Mexico’s position as the world’s leading blackberry producer.

→  Baja California (blueberries, raspberries): Positioned as a key growth region for premium blueberry production, targeting the spring window when Peruvian supply is lower. The threat here is winter flooding from a jet stream shift—150–200% of normal rainfall during strong El Niño winters can damage infrastructure and disrupt production timing.

→  Sonora (protected horticulture): A Super El Niño summer brings extreme heat that stresses greenhouse cooling systems and increases input costs. Combined with already-stressed water availability, this creates compound pressure on operations already running lean after 2025.

How growers are adapting

The Mexican produce sector is not standing still — but the pace of the pressure is testing the pace of adaptation.

In tomatoes, the clearest structural response is the accelerating shift away from open-field production toward protected greenhouse systems. Protected agriculture now accounts for approximately 65% of total Mexican tomato production, and that share is growing. Growers investing in medium- and high-tech operations are doing so not just to insulate against weather, but to produce the greenhouse-grown and specialty varieties — cherry, grape, heirloom — that U.S. and European buyers increasingly demand and that command better margins regardless of the tariff environment.

The technology layer is deepening alongside the infrastructure. Dutch greenhouse systems for climate control, irrigation, and crop monitoring are being deployed across Sinaloa and Querétaro. Sensor networks, AI-assisted crop monitoring, and data-driven cultivation methods are accelerating as producers seek to optimize yield per square meter, per liter of water, and per unit of energy. Companies like Hortilife, Plantanova, Rijk Zwaan, and Enza Zaden are active across these transitions.

In berries, growers are refining harvest timing to capture premium price windows, replacing varieties like Biloxi with higher-yielding alternatives such as Sekoya Pop, AzraBlue, and Madeira, and strategically shifting the blueberry production window to spring — February through May — to reduce competition with Peruvian supply and capture stronger international pricing.

Market diversification is also underway. Mexico maintains tariff-free access for tomatoes to Canada, the EU, Japan, the UK, and markets across Central and South America — and growers are actively developing those channels to reduce dependence on the U.S. market, where antidumping duties now apply. This is a structural strategic shift, not a temporary hedge.

The industry is also policing itself. AMHPAC established the Mecanismo de Supervisión y Vigilancia — known as MESUVI — in coordination with legal counsel in Mexico City, specifically to monitor Mexican tomato exports and prevent violations of the minimum export prices set after the Suspension Agreement ended. This is significant: the Mexican industry is not just adapting commercially; it’s building the compliance infrastructure to show U.S. authorities it can operate within the rules of the new trade environment. That kind of self-regulation is rare and signals a sector playing the long game, not waiting for the tariff to go away on its own.

►  Source: Dirección de Ejecución y Cumplimiento, AMHPAC (2026)

Efficient irrigation, drought-tolerant varieties, and enhanced drainage systems are all part of the adaptation picture — each requiring upfront investment that lands before the first box ships.

The growers who will come through this season strongest are not the ones who waited for the pressures to ease. They’re the ones who found a way to keep operating at full capacity while the pressures were still in place.

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The financial gap these pressures create — and where ProducePay can help navigate the storm

Three simultaneous pressures — a tariff that cuts revenue, a peso that loses value when it arrives, and a climate event that raises costs before anything ships — share one financial signature: the gap between when money goes out and when it comes back widens, while the amounts coming back shrink.

This is the environment ProducePay was built for. We work with Mexican produce growers — tomato, berry, and protected horticulture operations — across the full season arc:

→  Before the season: Pre-Season financing from planting through harvest, using your future harvest as collateral — not physical assets. For growers investing in variety upgrades, greenhouse infrastructure, or accelerated preventive programs this season, capital that arrives before harvest is the difference between adapting and absorbing the loss. Our underwriting process takes 30 days or less.

→  When shipments move: QuickPay converts shipments already in transit into same-week liquidity — turning a 75–90 day payment cycle into cash within the week. In a season where margins are compressed from multiple directions, waiting three months for revenue you’ve already earned isn’t a financing decision. It’s a risk.

→  All season long: Visibility into shipment data, GMV, and final pricing in real time — so your team is operating on current information, not end-of-month reconciliation. In a season defined by uncertainty, knowing where your product is and what it’s worth is a competitive advantage.

If you’re a Mexican produce grower managing tariff pressure, currency headwinds, and El Niño conditions: