Analyzing the market demand for Mexican tomatoes (Solanum lycopersicum L.) in the United States

Abstract

This paper estimates import demand models for fresh and processed tomatoes of Mexican origin in the US market. The analysis period is from January 2000 to October 2024, with monthly data. Autoregressive distributed lag (ARDL) models, cointegrating models such as FMOLS and CCR, and Granger causality are used. Some results indicate that as the import price of fresh Mexican tomatoes in the US increases, the demand for this product rises. If the price of imported processed Mexican tomatoes increases, then the demand for this product decreases. If the real exchange rate increases (equivalent to a decrease in the purchasing power of US consumers for Mexican imports), then the quantity demanded of fresh Mexican tomatoes falls. When real per cápita disposable income in the US increases, the demand for processed tomatoes rises; however, no effects on the demand for fresh tomatoes are observed. Fresh tomatoes produced in the US and tomatoes imported from Mexico are substitute goods, and tomatoes imported from Mexico and tomatoes imported from Canada are complementary goods. These behaviors are observed in the long run. These results are useful for improving Mexican agri-food trade promotion policies and for planning by companies exporting fresh fruits and vegetables. This is especially important in scenarios of trade uncertainty for agricultural products between the US and Mexico.