USTR: Obama administration won’t undermine sugar program
August 03, 2015 |08:40 PM
SANTA ANA PUEBLO, N.M. — The Obama administration will not weaken the U.S. sugar program in the Trans-Pacific Partnership negotiations, a key U.S. trade official told U.S. sugar growers today.
“We are not doing anything in TPP that will undermine the U.S. sugar program,” Sharon Bomer Lauritsen, the assistant U.S. trade representative for agricultural affairs and commodity policy, said here today at the International Sweetener Symposium, the annual meeting of the American Sugar Alliance, which represents sugar and cane growers.
Bomer Lauritsen, who had flown to New Mexico from the TPP negotiations in Hawaii, noted that Trade Representative Michael Froman and Agriculture Secretary Tom Vilsack had both made that same commitment publicly.
She added, however, that providing additional market access to Australia and Canada is part of the negotiations with those countries.
The U.S. sugar program, which was reauthorized in the 2014 farm bill, manages sugar supplies for the benefit for U.S. producers first, but allows for imports.
If prices go too low, however, growers have the right to U.S. government payments, and the farm bill orders the Agriculture Department to manage the program so that no payments are made.
Mexico has free-trade access in sugar to the U.S. market, but agreed to limit those exports after the U.S. government found last year that Mexico was subsidizing and dumping sugar in the United States, a decision that could have led to trade retaliation. Under the current “suspension agreement” between the United States and Mexico, the U.S. government does not foresee any payments to U.S. producers, but increased imports could complicate that scenario.
Bomer Lauritsen said the United States did not have any meetings with Australian sugar industry officials in Hawaii and that “how much we do for Australia” will depend on the rest of the TPP deal. She did not mention other issues with Australia, but the two countries have disagreements over how biologics, particularly pharmaceuticals, will be handled.
Australia currently has the right to export 87,000 tons of sugar to the United States and did not get any increased access under the U.S.-Australian free trade agreement. There have been reports that the Australian sugar industry has demanded the United States allow the importation of 750,000 tons and that the United States has offered to allow 150,000 tons of imports from Australia.
Bomer Lauritsen did not mention any numbers, and Don Phillips, the trade adviser to ASA, also declined to talk numbers.
But asked in a meeting with reporters if the United States can grant Australia more access without undermining the U.S. program, Phillips said, “It is clear Australia is going to get something out of this agreement. We can give them something without undermining it. We think it is very limited.”
Phillips called the Australian industry’s proposal for 750,000 tons access “hyperbolic … totally outlandish.”
Bomer Lauritsen said the issue of access to the U.S. market for Canadian sugar has come up because the United States wants Canada to open up its market to U.S. dairy, poultry and egg exports and Canada doesn’t have other products for which it wants increased access in the United States.
“That is a really unique situation,” she said.
U.S. sugar industry officials said Canada does not produce much sugar, but there is some beet production in Alberta. A Michigan co-op has sugar acreage in Ontario and beets from there are sent to the United States for processing.
In addition, Canada exports more in sugar-containing products to the United States than the United States exports to Canada.
Canada also has antidumping duties on U.S. sugar, resulting from a case of U.S. exports to Canada 20 years when the United States had a surplus of sugar and sent the excess supply north. (See chart.)
“I won’t say they will get nothing but we prefer that they get nothing,” Phillips said.
The Coalition for Sugar Reform, which includes the Sweetener Users Association, the National Confectioners Association and other groups, has called for a substantial increase in foreign sugar market access under the TPP on the grounds that U.S. candy companies and other industrial sweetener users have difficulty competing with companies in other countries.
Bomer Lauritsen said that Phillips and Ryan Weston, who represents the Florida, Texas and Hawaii sugar growers in Washington, had been present in Hawaii and that “their advice is critical as we thread the needle as we put together a package that does not undermine the U.S. sugar program.”
Growers attending the symposium appeared pleased with Bomer Lauritsen’s remarks.
“This is one of the best administrations we have ever worked with on trade,” said Carolyn Cheney, the vice president for national government affairs of the Sugar Cane Growers Cooperative of Florida, who has been serving as ASA chair and presided over the luncheon at which Bomer Lauritsen spoke.
