Foodmakers Seek 1 Million-Ton Boost In Sugar Quota

April 12, 2012 7:20 PM EDT
sugar package
sugar package (Photo: Flickr)

The U.S. sugar import quota should be increased by 1 million tons, or nearly double the current quota, to relieve tight supplies that are being made worse by a poor crop in Mexico, a foodmakers group said on Wednesday.

The Sweetener Users Association, which represents food and beverage companies including candy makers, made its request in a letter to Agriculture Department officials, who were barred by law from changing the quota before April 1.

A USDA report showed on Tuesday the sugar supply strain was getting worse, with production falling in Mexico, a major supplier.

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USDA was expected to use the April estimate to determine whether to raise the quota, set last August at 1.23 million short tons raw value.

"Clearly, there is no case to be made for delaying a major (quota) increase," said the trade group.

It said an increase of 982,000 to 1.11 million tons was needed to assure adequate supplies for the rest of the marketing year, which ends on Sept 30. The group would prefer a 1.11 million-ton increase.

"Of the total (quota) increase, we believe a substantial portion should be refined sugar, recognizing that the lost Mexican imports would have included substantial amounts of refined sugar," said the Sweetener Users.

It also said USDA should allow early entry of sugar that would be covered by the quota for the new marketing year and for U.S. Trade Representative Ron Kirk to re-assign country-by-country quotas to reduce shortfalls on this year's quota.

The trade group said Congress should end the tariff-rate quota system when it enacts the new farm law.

U.S. sugar growers have opposed import increases. Also U.S. policy limits sugar imports as part of a system that assures a minimum price for domestic sugar.

Copyright 2012 Thomson Reuters. All rights reserved.

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