Broad-Based Coalition Welcomes House and Senate Introduction of Sugar Reform Bills, Urges Congress to Pass Legislation This Year

Says Program Should Work for All Stakeholders, Not Just One Special Interest Group

Washington, DC February 14, 2013 – The Coalition for Sugar Reform welcomed today’s introduction of bipartisan sugar reform legislation in the House and Senate. The Sugar Reform Act would make modest reforms to the Depression-­‐era U.S. sugar program. The legislation would roll back the sugar program’s most costly, restrictive and market-distorting provisions enacted as part of the 2008 Farm Bill. The bills would also provide economic relief to American consumers and businesses who have been forced to pay a $14 billion hidden tax over the past four years alone in order for the federal government to provide a special interest subsidy to sugar producers.

“We applaud the bipartisan leadership of Reps. Pitts, Davis, Goodlatte and Blumenauer and Sens. Shaheen, Kirk, Toomey, Durbin, Portman, Lautenberg, Feinstein, Corker, Ayotte and Alexander, for introducing the bills and beginning the conversation in the House and Senate on the merits of reforming the costly sugar program. We also applaud the more than 40 House and Senate co-­sponsors who have joined in the effort to ensure the sugar program works for both sugar producers and sugar users,” said Larry Graham, Chairman of the Coalition for Sugar Reform and President of the National Confectioners Association.

“These reform bills would help to modernize one of the most outdated federal programs still in operation, which has driven up the price of U.S. refined sugar – currently about 30 percent higher than on the world market – and continues to create unnecessary instability in the market, stifling American economic growth and job creation,” Graham continued.

The sugar program puts nearly 600,000 jobs in sugar-­using industries at risk, impedes businesses from growing and creating new jobs and often forces U.S. manufacturers to import sugar-­‐containing products or move plants and factories offshore. According to U.S. Department of Commerce data, between 1997 and 2011, nearly 127,000 jobs were lost in U.S. sugar-­using industries.

The legislation introduced in both chambers of Congress today calls for the repeal of unnecessary trade restrictions preventing the Secretary of Agriculture from allowing additional sugar imports when needed and the Feedstock Flexibility Program, which requires the government to buy surplus sugar and sell it to ethanol companies at a loss. Additionally, the bills call for reform of domestic supply restrictions, granting the Secretary of Agriculture the authority to modify or suspend domestic marketing allotments, and providing more flexibility for USDA in administering the import quota system.

“The sugar program should work for all stakeholders, including consumers and sugar-­using companies in all sectors of the economy. The big misconception perpetuated by the sugar lobby is that sugar reform will only benefit candy companies, and that’s simply not true. It’s not just a candy issue. It’s a food and beverage issue; it’s an environmental issue; it’s a consumer issue; it’s a small business issue; and it’s an economic issue,” Graham said. “The sugar program in its current form is a failed policy that isn’t working for most of the people it affects and Congress should take action to reform it this year.”

For the House bill text, click here. For the Senate bill text, click here.

Learn more about U.S. sugar policy and why reform is long overdue to protect the nation’s consumers, food manufacturers and small businesses at www.SugarReform.org.

About the Coalition for Sugar Reform: The Coalition for Sugar Reform (www.SugarReform.org) represents consumer, trade, and commerce groups, manufacturing associations, and food and beverage companies that use sugar – including confectioners, bakers, cereal manufacturers, beverage makers and dairy companies – as well as the trade associations for these industries.

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U.S. sugar reform bill proposed in both houses

American Shipper Friday, February 15, 2013 (excerpts)

A bipartisan group of U.S. legislators proposed bills in both the House and Senate to reform the Depression-era sugar program, including rolling back provisions in the 2008 Farm Bill that protect U.S. sugar growers.

Sugar users, spearheaded primarily by the Sweetener Users Association (SUA), the Coalition for Sugar Reform and the National Confectioners Association (NCA), have been pushing for Congress to enact more trade-friendly regulations regarding sugar, including raising import quotas from global sugar producers with surpluses. The United States consumes more sugar than it produces but still limits the amount it imports from various sugar-producing nations to protect domestic producers.

Those lobbying groups argue U.S. growers, protected against competition from foreign producers (most notably Australia), are not incented to increase refining capacity, which impacts sugar users and ultimately consumer food prices.

“We’d like to be able to buy sugar for what the rest of the world is able to buy sugar for – it’s as simple as that,” said Eddie Opler, chairman and chief executive officer of the confectionary company World’s Finest Chocolate…. 

The legislation introduced in both chambers Thursday calls for the repeal of trade restrictions preventing the Secretary of Agriculture from allowing additional sugar imports when needed and the Feedstock Flexibility Program, which requires the government to buy surplus sugar and sell it to ethanol companies at a loss…. 

The American Sugar Alliance, which represents domestic growers, has argued the protections allow growers to manage rising input costs and subsidized sugar from other markets, at no cost to taxpayers. Opponents suggest the cost to taxpayers comes in the form of higher costs for consumers.

“Our biggest obstacle to growing is the fact that we have to pay so much more for sugar than our competitors who are stationed right across the border in Canada,” says George Stege, president of Ford Gum & Machine Co., Inc. “How do you compete when your most abundant product is 46 percent more in cost? It’s no wonder that our competitors have gone to Canada.”

read … American Shipper Friday, February 15, 2013

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Not so sweet Battle over Australian access to the U.S. sugar market could sink TPP’s potential

American Shipper Thursday, October 25, 2012

The Sweetener Users Association (SUA), a lobbying body that represents some of the country’s largest food and beverage companies, has long argued the United States needs to break down trade barriers that prevent sugar exporters from tapping into U.S. demand.

SUA said during a briefing at the National Foreign Trade Council (NFTC) offices in mid-September that granting unfettered market access to Australian sugar won’t hurt U.S. producers since domestic production can’t keep pace with U.S. demand in any case.

“The game is the refined sugar market,” said Tom Earley, vice president of Agralytica Consulting and an economist for SUA. “Growers own almost all the refining capacity. So whether it’s domestic or imported raw sugar, they’re making their money on the refining margin.”

U.S. production capacity has been hindered, he argued, by a need for new sugar mills. But without any impetus to battle import competition, the U.S. sugar growing industry has not invested in that capacity, content to profit on the refined side of the process.

In a June editorial, the Wall Street Journal reported that the nation’s roughly 5,000 sugar growers get annual subsidies of $1.4 billion, but that U.S. consumers pay twice that amount through higher food prices.