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WASHINGTON -- The federal government is shielding American sugar
farmers at a cost to consumers of $1.9 billion a year, congressional
auditors say in an immediately controversial new report.
Angering Central Valley sugar beet farmers, while providing
ammunition for sugar program skeptics such as Sen. Dianne Feinstein,
D-Calif., General Accounting Office auditors contend American prices
are being artificially kept several times higher than the world
price.
"The primary beneficiaries of the sugar program's higher
prices are domestic sugar beet and sugarcane producers," GAO
auditors contend. But the new study irritates the California farmers
who have seen the state's sugar beet plantings shrink from a high of
300,000 acres to the present 115,000 acres, and who anticipate
losing two more of the state's remaining sugar-processing plants
this year.
"If they think prices were so great for us, you wouldn't see
this happening," Manteca farmer James Nilsson said Monday.
Nilsson cites his own farming career to illustrate the industry's
travails. He started planting sugar beets in San Joaquin County in
the early 1970s, and at one time harvested as many as 800 acres. The
president of the 900-member California Beet Growers Association,
he's now down to only 250 acres worth of sugar beets and doesn't
expect any more after this year.
"I've harvested my last sugar beet crop," Nilsson said,
because "sugar prices are so low."
Within the past decade, California's eight sugar-processing
plants shrank to four. Two of the remaining Imperial Sugar plants,
in Tracy and Woodland, are scheduled to close by the end of the
year. The survivors, meanwhile, are looking at the prospect of
further foreign competition -- including a tenfold increase in
imported Mexican sugar permitted under the North American Free Trade
Agreement.
"It's very concerning to the market," said Ben Goodwin,
executive director of the Stockton-based California Beet Growers
Association.
This week, Goodwin will be in Washington as part of an
agricultural advisory panel that will get briefed on sugar trade
issues. Besides the rising number of Mexican imports, these issues
include U.S. grower allegations that Canada is improperly shipping
too much sugar into the United States.
Limiting sugar imports is the heart of the program under fire in
the new 104-page GAO study. Unlike traditional subsidy programs for
crops such as rice and cotton, the government does not customarily
make direct payments to U.S. sugarcane and sugar beet growers.
Instead, domestic sugar prices are maintained artificially high
primarily by restricting foreign imports. |