A bipartisan group of U.S. senators introduced legislation Thursday that would reform a Great Depression-era national sugar program.
The legislation will give the U.S. Department of Agriculture’s secretary the flexibility to adjust marketing allotments and import quotas as needed to stabilize the U.S. sugar market.
The Coalition for Sugar Reform, which supports the 2015 Sugar Reform Act legislation, said the current U.S. sugar program consists of price supports, marketing allotments and tariff-rate quotas that “manipulate the U.S. market to limit the amount of sugar available while also guaranteeing a minimum price for sugar – all to prop up the already profitable U.S. sugar producers.”
The industry coalition said the current sugar policy costs consumers up to $3.5 billion annually in the form of a hidden taxes and taxpayers nearly $300 million in fiscal year 2013 due to loan forfeitures, implementation of the sugar program’s Feed Stock Flexibility Program and other government actions. The Congressional Budget Office, in its January 2015 Baseline for Farm Programs, forecasts the U.S. sugar program will cost taxpayers an additional $163 million over the next 10 years.
“Times have changed significantly since America’s protectionist sugar policy was first enacted during the Great Depression,” John Downs, Chairman of the Coalition for Sugar Reform and President of the National Confectioners Association, in a statement. “We urge lawmakers to take the steps necessary to ensure the U.S. sugar program reflects the realities of today’s sugar market and the competitive global economy.”
“The U.S. sugar program is bad for American consumers, bad for the U.S. economy and bad for our global trading system,” said Bill Reinsch, president of the National Foreign Trade Council. “It’s time to end the instability that has plagued the sugar market over the years by enacting comprehensive reform, as proposed in the Sugar Reform Act.
“We urge the Senate to pass this legislation without delay,” he added.
The coalition warned, however, that the future for the U.S. sugar trade “looks even worse as a result of the antidumping and countervailing duty cases against Mexican sugar imports filed by U.S. sugar growers last March. Not only have the cases already cost consumers $837 million from April 2014 to October 2014, but the suspension agreements signed by the parties involved put new restraints on imports of Mexican sugar for at least the next five years – causing continued market instability with unnecessarily tight sugar supplies.”