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WASHINGTON, Sept 27 (Reuters) - U.S. sugarcane and
sugarbeet processors could forfeit as much as 400,000 short tons more
sugar to the federal government on Monday because of low prices, a U.S.
sugar industry official said Wednesday.
``That's probably a reasonable estimate,'' Jack Roney,
chief economist of the American Sugar Alliance (ASA), told Reuters.
The U.S. Agriculture Department has estimated total
forfeitures this year in the range of 500,000 to 600,000 short tons. Over
the past two months, processors have forfeited about 168,000 short tons,
raw value, Roney said.
Loans for about another 900,000 short tons come due
on Saturday, setting the stage for the biggest round of forfeitures yet.
Processors have until the close of business on Monday
to forfeit the loans and pay a penalty of 1 cent per pound for cane sugar
and 1.072 cents per pound for refined beet sugar.
However, processors that plan to pay off their loans
must inform the department on Friday.
ASA will survey sugarcane and sugarbeet processors to
come up with an estimate of forfeitures on Monday.
``It won't be final USDA data,'' but it should be
close, Roney said, noting it could be late in the week before USDA
releases an official figure.
Sugar programme foes have estimated loan forfeitures
next week could be as high as 500,000 to 800,000 tons.
Roney said he doubted forfeitures would be that high
because of contract commitments to deliver sugar to industrial users and
limited storage space.
Meanwhile, sugar programme supporters in the Senate
are continuing efforts to block sugar syrup imports from Canada by
plugging a loophole in the U.S. tariff-rate quota.
USDA estimates the loophole allows the equivalent of
125,000 short tons of sugar to enter the U.S. market annually at low duty
levels.
Sen. John Breaux, Louisiana Democrat, hopes to offer
an amendment to plug the loophole during Senate Finance Committee work on
a bill to help low-income communities.
Committee action on that bill was scheduled for
Wednesday, but was postponed for at least the third time.
Idaho Republican Senators Larry Craig and Mike Crapo
expressed support for the Breaux amendment in a joint statement on
Tuesday.
``If this loophole is not fixed, the result will be
continued unstable sugar prices in the United States, leading to more beet
and cane farm failures, more sugar processing factory closures, and
forfeitures of USDA sugar loans at a significant cost to the U.S.
Treasury,'' Craig said.
The Breaux amendment has about 20 Senate co-sponsors,
an aide to Craig said.
Company officials at Heartland By-Products in Taylor,
Michigan say the provision would drive them out of business if it becomes
law. The firm is owned by the U.S. subsidiary of the British trading house
E D & F Man (quote from Yahoo!
UK & Ireland: EMG.L).
A 1995 U.S. Customs Service ruling has permitted
Heartland to import sugar syrup from Canada without paying high duties
under the U.S. tariff-rate quota for sugar. |