1 The North American Free Trade Agreement and Horticultural Products

International trade is vitally important to U.S. horticulture. U.S. exports of horticultural products have doubled since 1990 and are expected to reach a record $10.8 billion in 1998. U.S. horticulture producers now export 27 percent of their product compared to 20 percent in 1990. However, the United States is still a net importer of horticultural products, as imports increased from $8.2 billion in 1990 to $12.8 billion in 1998. About 15 percent of U.S. fruit and vegetable consumption is composed of imports. Fresh fruits and vegetables account for about 80 percent of all U.S. horticultural imports. Several factors determine the level and composition of horticulture trade. Income levels and trade liberalization are keys to long term growth for U.S. products. Global supplies and exchange rate fluctuations are important short term determinants of market growth and foreign competition. It is well documented that consumers in developing countries, such as Mexico, spend large shares of increases in their incomes on food. As incomes in these countries grow, it is expected that U.S. horticultural products exports will increase in order to meet growing market demand. Increased market access through trade liberalization also will lead to greater export potential for U.S. products over the long term. More competition for the U.S. market also can be anticipated