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From:
Delegates to the 2001 International Sweetener Colloquium.
Subject:
The peculiar government program that props up the incomes of U.S. sugar
growers by restricting imports and giving them loans they can satisfy by
turning over their crops if the market price is lower than the loan.
Problem:
It's encouraging overproduction and creating a glut just when NAFTA and
other trade commitments are about to open U.S. borders to more imported
sugar.
Solution:
Another government program.
The 350 colloquium delegates ended their three-day
conference Wednesday by trying to reach consensus on how to advise the
newly appointed Veneman on the controversial sugar program. Growers were a
distinct minority among the representatives of food and beverage companies
-- the big industrial users of sweeteners -- and U.S. and foreign
bureaucrats.
Sugar cane and beet growers forfeited massive amounts
of sugar to the government last year, despite the U.S. Department of
Agriculture's emergency buy of $54 million worth to try to boost the
market price. The forfeitures included 308,000 tons, worth more than $100
million, turned over by South Florida's three major sugar producers --
Clewiston-based U.S. Sugar Corp., Palm Beach-based Florida Crystals Inc.
and the Sugar Cane Growers Cooperative, based in Belle Glade.
That effectively quashed the sugar program's claim of
being "no-cost" to taxpayers, some delegates argued, so if the
government intends to continue supporting sugar growers, it might as well
give them a direct subsidy like other farm supports.
They said paying growers the difference between their
crop loans and the price they get on the market would at least force
growers to sell their sugar and wouldn't leave the government in the
predicament it's in now -- sitting on 800,000 tons of surplus sugar it
doesn't know what to do with and facing the possibility of more
forfeitures this year.
Paul Mathiason of the American Sugarbeet Growers
Association worried that such a plan could hurt public perception of
growers even more.
"We got trashed in the press for a ($54 million)
buyout last summer," Mathiason said. "Imagine if we had a
(direct) payment program, and it cost $2 billion."
An Australian trade official objected to any type of
support for growers. First Secretary Thomas Roth of the Australian Embassy
in Washington said it leads to overproduction and encourages other nations
that subsidize their sugar industries. He said it makes it harder for
less-subsidized nations to get access to the U.S. market, which must
accept increasing amounts of Mexican sugar under the North American Free
Trade Agreement.
"Our clear message is this: Australia and other
trading partners are not prepared to pay for Mexico's increased access to
this market," Roth said.
Delegates had little sympathy for the idea of trying
to control sugar production.
"There's no point in reducing production if it's
only going to be replaced with Mexican sugar," said Frank Jenkins of
Wilton, Conn.-based Jenkins Sugar Group.
Roth noted that bad weather cut crop yields in Brazil
and a few other sugar-growing nations last year, bringing the world market
price up a bit from its 25-year low but still far below the U.S. support
price. Domestic sugar prices are trading in the 21-cent range this week,
about 2 cents above what growers say is the break-even mark.
"There is no shining horizon for the sugar
program," Roth said. "The best thing we can hope for is bad
weather."
mary_mclachlin@pbpost.com |