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Return to sugar-sale program
By Susan Salisbury, Palm Beach Post Staff Writer
May 1, 2001
 
Florida's sugar cane growers are calling for a return to a program abandoned in 1995 that dictated how much sugar producers could sell.

But they don't want that to happen until problems with Mexican sugar imports and "stuffed molasses" imports from Canada are resolved, say representatives of the state's three sugar producers -- Florida Crystals in Palm Beach, U.S. Sugar Corp. in Clewiston and the Sugar Cane Growers Cooperative of Florida in Belle Glade.

Last year, sugar cane and beet growers nationwide forfeited 1.1 million tons of sugar -- 294,000 tons of that from Florida growers -- as part of a government loan program that allows them to use sugar as collateral. That meant they did not have to repay government loans.

The U.S. Department of Agriculture is still holding 793,000 tons of sugar in the sugar companies' warehouses, at a cost of $1 million a month.

Under the market allotments program that the growers want to reinstate, farmers can grow as much sugar as they want, but are limited in the amount they can bring to market, said Van Boyette, a Washington representative for Florida Crystals.

"If you do that, the prices will be high enough that the government won't end up owning it," he said. "We're trying to lay out a program where the government doesn't have to buy sugar any more."

That position is opposed by trade groups such as the Sweetener Users Association, which represents manufacturers of candy and other products that contain sugar.

"We have a problem with marketing allotments," said Tom Hammer, the Washington, D.C.-based group's president. "They generally are formula-driven. You hobble the most efficient growers and keep the least efficient growers in the game."

Sugar prices have been pushed down by an oversupply attributable to factors such as excellent harvests and farmers switching to sugar from other crops.

Last Thursday, sugar growers went to Washington for a House Agriculture Committee hearing. The committee is beginning deliberations on the 2002 Farm Bill. The 1996 farm bill, known as the Freedom to Farm Act, threw out subsidies and acreage reduction programs for corn, wheat, rice and other crops, leaving farmers free to plant at will.

It also preserved sugar price supports that allow forfeiture of government loans when sugar prices are low, but eliminated marketing allotments.

Jack Roney, staff economist at the Washington, D.C.-based American Sugar Alliance, an umbrella group of farmers, processors and suppliers, said he's optimistic that the marketing allotment program, which was run by the federal government from 1990 to 1995, can be reinstated.

At last week's hearing, none of the 25 or so members of the House Agriculture Committee expressed skepticism about the program, he said.

"It reflects their understanding of the situation we face," Roney said. "This is the only alternative that would work for us."

External factors that must be dealt with first include sugar imports from Mexico, said Judy Sanchez, spokeswoman for Clewiston-based U.S. Sugar Corp.

Under a provision of the North American Free Trade Agreement, imports of Mexican sugar rose nearly fivefold, to 116,000 metric tons, in the budget year that began in October, at a time when sugar prices were already low. Last week, the Mexican government said it expects U.S. trade and agricultural authorities this month to authorize tariff-free imports of 300,000 tons of Mexican sugar.

The Sugar Alliance also called for legislation that would prohibit the importation of tariff-free stuffed molasses -- molasses with sugar added.

This year, for the first time ever, Florida's three major sugar companies produced more than 2 million tons of sugar.