Brazil, the world's biggest producer and exporter of sugar, sells it for 9 cents a pound on the international market, compared with the U.S. domestic price of 21 cents a pound.

``They could almost displace our entire domestic sugar production,'' said Rep. Collin Peterson, a Democrat who represents the beet-producing Red River Valley in northwest Minnesota. He is starting a House coalition aimed at scuttling the proposed Free Trade Area of the Americas.

``They are the huge player in the world,'' said Luther Markwart, chairman of the American Sugar Alliance, which represents sugar growers, processors and suppliers. ``Brazil runs over everybody.''

Domestic sugar is produced from beets in northern states such as Minnesota, North Dakota and Idaho, and from sugar cane in Florida, Texas and Louisiana. Some farmers grow corn to make beverage sweeteners, such as high-fructose corn syrup.

The U.S. sugar industry is protected by import restrictions, but the North American Free Trade Act recently opened up the domestic market to 250,000 metric tons of Mexican sugar a year, and restrictions on Mexican sugar will be phased out entirely by 2008.

At a hearing last month of the House Agriculture Committee, sugar industry officials said opening up the U.S. market to more sugar would be devastating.

``The U.S. sugar market does not require additional foreign sugar through the FTAA,'' said Jack Roney, an economist with the American Sugar Alliance. ``Our market is oversupplied, and producer prices have been running at, or near, 22-year lows. The industry is in severe financial crisis.''

U.S. growers had one of their worst years in 2000, when farmers destroyed 7 percent of the sugar crop under a federal program intended to reduce a price-depressing glut. Meanwhile, the government is paying $1.4 million a month to store sugar it bought from farmers last year under price-support loans.

The General Accounting Office, Congress' investigative arm, concluded that the federal sugar program -- a mixture of loans, price guarantees and import quotas -- cost refiners, food manufacturers and consumers about $1.9 billion in 1998.

Brazilians say any exemption for sugar from a free trade accord would be a deal-breaker.

``The United States wants us to open further our markets for U.S. products,'' said Rubens A. Barbosa, Brazil's ambassador to the United States. ``We cannot accept that we continue to open unilaterally our products unless it's a two-way avenue.''

The American Sugar Alliance claims Brazil unfairly subsidizes its sugar through debt reductions, freight subsidies, ``strategic'' devaluations of currency, low labor and environmental standards and ethanol subsidies. Some Brazilian sugar cane goes to ethanol production. Brazil sells its sugar at the world ``dump'' price that is less than the cost of the producing it, the alliance says.

``This is ridiculous,'' said Brazil's ambassador. ``How can you imagine that devaluation is a subsidy?''

It's the United States that's subsidizing its sugar growers, Barbosa said.

Gary Hufbauer, a trade analyst at the Institute for International Economics, a Washington think tank, called the U.S. sugar group's charges mostly ``hogwash.''

``This industry is wedded to protection,'' Hufbauer said.

The Agriculture Department has predicted that while a hemispheric free trade agreement would help U.S. farmers overall, U.S. sugar prices, production and exports could decline significantly.

Hufbauer went even further than that.

``Beet sugar would go,'' he said, adding that any deal would likely be phased in over 15 years, giving farmers time to change to another crop. ``Overall, the industry would shrink 60 to 75 percent.''

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On the Net:

American Sugar Alliance: http://www.sugaralliance.org/home.htm

Free Trade Area of the Americas: http://www.ftaa-alca.org/alca--e.asp

Brazilian Embassy: http://www.brasilemb.org/