The United States will hit Mexican sugar imports with anti-dumping and countervailing duties by June 5 if the two countries can’t reach a new deal managing cross-border sugar trade, the Commerce Department announced late Monday.
The decision sets up another tense trade situation with a North American neighbor as the two sides reached an impasse on trying to salvage a 2014 deal that suspends imports from being slapped with retaliatory duties as high as 43 percent imposed earlier the same year. U.S. sugar refiners asked for an administrative review of the deal in 2016, accusing Mexican producers of circumventing the agreement by shipping semi-refined sugar that needs minimal processing yet avoids quantitative restrictions on refined sugar exports. U.S. refiners say the situation has hit them hard on both sides with a shortage of raw sugar supplies to process and suppressed refined sugar prices.
“While I regret that such measures were needed, it is my hope that Mexico and the United States can reach a fair agreement before June,” Commerce Secretary Wilbur Ross said.
Industry sources said the talks broke down over the question of how much raw vs. refined sugar would be allowed into the U.S. and the standard at which raw sugar could still be classified as such. The suspension deal defines refined sugar as having a polarity or sucrose level of 99.5 percent or more. A significant portion of Mexico’s raw sugar exports technically fall below that 99.5 percent threshold but require little to no additional processing to be used in beverages, ice cream and baked goods.
Source: www.politico.com