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Industry awaits PIK decision
By Lorraine Cavener, Ag Weekly correspondent, The Times-News
August 21, 2001
 
BURLEY -- Still no word on a PIK program.

"The only thing I've heard is that nobody has heard anything," said Steve Ulrich, Cassia County director of Farm Service Agency.

Growers have been waiting for word on the federal payment-in-kind program for several months.

"There is still considerable frustration that the USDA has not made a decision on this yet," said Mark Duffin, executive director of Idaho Sugarbeet Growers Association. A month after Duffin's statement in the July 18 newsletter to members a decision about the program has still not been handed down from the USDA.

The PIK program has been part of the sugar industry's congressional hearings on the long-awaited Farm Bill.

Under the program, which would help alleviate the sugar surplus, crops would be destroyed in the field and growers would receive payment equal to what they would receive if beets were harvested.

While growers continue to wait for the decision, the market also waits.

A recent market report on sugar trading said the domestic (No. 14) market was dormant, awaiting word as to whether USDA will implement a payment-in-kind program for beet growers.

"The Secretary (of Agriculture, Ann Venneman) has waited to see how the numbers develop on this year's crop before making a decision," Duffin said. "It is likely she will make a decision very soon, and there is reason to hope a PIK II will be implemented to dispose of the government-owned sugar."

Idaho's congressional delegates have been involved in advocating PIK for some time. Senators Larry Craig and Mike Crapo, along with 18 other senators sent a letter to Venneman to encourage the USDA to announce an expanded and improved PIK program, said a June news release from Craig's office.

The letter said PIK would be "the best way to dispose of the remaining large quantities of government-owned sugar, reduce surplus production for the current year and strengthen returns for producers and the marketplace."

USDA's John Love, chairman of Interagency Sugar Estimates Committee and Senior Commodity Analyst for sugar and specialty crops, commented on contributing factors to the domestic sugar market at the recent 18th International Sweetener Symposium in Sun Valley.

"A 2001/02 PIK would reduce CCC (Commodity Credit Corporation) stocks in the short run and help to lift the market overhang currently pressuring the mid-west beet sugar market," Love said.

But PIK and reduction of CCC stocks are small factors in the market, he said.
While speculation continues on how PIK would or would not affect the volatile sugar market, growers continue to wait for the decision.