Industry calls for collaboration of sugar producers and users

By Lorraine Heller

- Last updated on GMT

Related tags: Sugar

The Sweetener Users Association (SUA) has called for an end to the
"bitter disputes" between sugar users and producers, saying
the industry needs to unite in a common effort to improve the US
sugar policy.

The announcement comes at a time when the nation's sugar supply is historically tight, and manufacturers are faced with increased prices.

The SUA, which represents food and beverage companies that use sugar, has repeatedly petitioned the USDA in recent months to allow for extra sugar imports in order to relieve the tight market and supply food makers' needs.

In December, the USDA announced it was to allow 450,000 tons extra sugar imports into the country, but this is still not enough, according to the SUA.

"As the year moves on and the market remains tight, it will be absolutely necessary for the USDA to allow more imports in order to preserve an orderly market and adequate supply,"​ SUA president Randy Green told last month.

The association now seems to be trying a new approach in its efforts to maintain a balanced market.

"As users, we need a stable, reliable, high-quality supply of sugar at competitive prices,"​ Green said last week. "Suppliers, in turn, rely on us to transform their commodity into a product with value to the ultimate consumer."

"It is in sugar users' interest to have a viable, healthy sugar-producing and sugar-processing industry,"​ he added.

According to the SUA, sugar policy has historically been marked by bitter disputes between producers and users.

"Frankly, I am not aware of another commodity where the gap between suppliers' and customers' policy preferences has historically been any wider,"​ said Green, adding that the arguments mask the reality of mutual dependence and the need for cooperation.

But Green says producers and users must now work together, in order to face mounting pressures facing the industry, such as unrestricted sugar imports from Mexico in 2008 and growing imports of sugar-containing products that have increased "because of the way the sugar program operates."

Other pressures he cited include Congressional projections that the sugar program will cost around $300 million a year in the future, and the probability that future trade agreements will create additional sugar import obligations as US negotiators bargain for more market access for export-oriented US farm products.

And according to Green, the current sugar policy is "unbalanced."

"The entire industry should begin to discuss how it can work together. The status quo does not work for us and will not work long for producers."

When Congress writes the 2007 farm bill, a sugar industry consensus would allow positive changes to be made, he explained.

"We think future policies need to emphasize the role of market needs in delivering an ample supply of sugar to refiners, industrial users and consumers, and support producer incomes without distorting market signals,"​ he said.

"It is also important that future policies be more transparent, administratively flexible and responsive to market needs, as well as consistent with our trade obligations."

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