The American Sugar Alliance, which represents cane and beet growers, expressed concern about the Agriculture Department’s report showing declining acreage devoted to sugar, while a business coalition says it is worried that the U.S. and Mexican governments will reach an agreement to manage the sugar trade with Mexico.
In its latest acreage report, USDA notes that acres of both sugarbeets and sugarcane are down this year—1.7 percent and 3.5 percent respectively, ASA noted in a news release.
The data, ASA said, “helps further quantify” some of the “damage” since large quantities of what ASA maintains is subsidized sugar is coming into the U.S. market.
The growers filed a countervailing duty petition against Mexican sugar, and the International Trade Commission issued a preliminary injury finding. A U.S. government investigation is under way to determine if Mexico has violated trade laws. ASA noted that the low U.S. prices have led to $278 million in U.S. government payments to growers to keep the U.S. market from collapsing.
Phillip Hayes, a spokesman for the American Sugar Alliance, notes that this is the fourth consecutive year that U.S. sugar beet plantings have fallen while Mexican producers have increased production and the Mexican share of the U.S. market has risen to nearly 18 percent.
Meanwhile, 18 consumer, trade, manufacturing, taxpayer watchdog and food and beverage organizations wrote a letter to Obama administration officials urging them not to enter negotiations with Mexico on a managed trade agreement in response to the antidumping and countervailing duty petitions.
In a letter to Commerce Secretary Penny Pritzer, Agriculture Secretary Tom Vilsack and Trade Representative Michael Froman, the groups wrote:
“We have heard troubling rumors about pressure being applied on the administration to consider the negotiation of a managed trade agreement between the Governments of Mexico and the United States to resolve the antidumping and countervailing duty petitions filed against U.S. imports of sugar from Mexico.
“We oppose managed trade in principle, especially between the United States and one of its NAFTA partners. Such an agreement would be particularly inappropriate in the case of sugar, a U.S. industry that already receives tremendous government protection from market forces at the expense of U.S. consumers and U.S. taxpayers.”
The letter was signed by the Coalition for Sugar Reform, American Bakers Association, American Beverage Association, American Frozen Food Institute, Chicago Area Retail Bakers Association, Competitive Enterprise Institute, Council for Citizens Against Government Waste, Food Marketing Institute, Grocery Manufacturers Association, Independent Bakers Association, International Dairy Foods Association, National Confectioners Association, National Foreign Trade Council, National Consumers League, Retail Bakers of America, Snack Food Association, Sweetener Users Association and the U.S. Chamber of Commerce.
In reaction, Hayes told The Hagstrom Report, “We are unclear what this group is talking about. The U.S. sugar industry is busy litigating the antidumping and countervailing duty cases against Mexico, and we are not pressuring the U.S. government to negotiate any agreement with Mexico.”
“It is up to the U.S. and Mexican governments to decide whether they want to discuss an equitable settlement of the cases and whether they want to take advantage of the settlement procedures established by the Congress under the antidumping and countervailing duty statutes.”