“We have a unique opportunity to find a bipartisan, simple and fair way to fix the U.S. sugar program to provide some relief to American families grappling with the high cost of food. Both Republicans and Democrats agree: It’s time to modernize and make changes that will make American companies more competitive on a global scale, create new jobs, and strengthen communities while protecting American sugar farmers at the same time,” Brian McKeon, SVP public policy, National Confectioners Association, explained during a panel hosted by ASFP earlier this week.
AFSP executive director, Grant Colvin echoed his sentiments, explaining during the panel that reforms proposed by AFSP would directly impact “the hundreds of thousands of manufacturing workers employed by American food companies,” especially local businesses operating on thinner profit margins, which are more susceptible to rising sugar prices.
During the event, AFSP explained a modernized sugar policy will:
- Remove USDA’s obligation to purchase excess sugar at a loss, and prohibit the resale of forfeited sugar to American shoppers who ultimately pay more,
- Allow for USDA flexibility and market fairness from farms to retail shelves,
- Place sugar on a level playing field with other commodities like corn, peanut, soy, rice, cotton, barley and wheat,
- Support American farmers, small businesses and workers.
"The price tag for consumers is estimated at between $2.4-4 billion a year. Especially now when food inflation is high, it is time for policymakers to update the sugar program, so it ensures an adequate supply of sugar at reasonable prices," Glick said.
In a separate comment on behalf of AFSP, Christine Lantinen, president of Maud Borup, wrote that American businesses and consumers are paying two and a half times more for sugar than other countries due to the cost of sugar today.
“The sugar program restricts both the domestic sugar supply and what is available for import. Constraining the market in this way pushes costs upward for businesses and ties the hands of both government and industry to address urgent concerns, such as supply shortages that are growing in frequency,” she wrote.
In March, AFSP hosted a panel discussion for Senate and House members on how a reformed sugar policy can help alleviate rising food costs. In February, AFSP underscored Secretary of Agriculture Tom Vilsack’s comments about Congress passing a bipartisan farm bill that benefits “many and most.”
Brian Riley, director, free trade initiative and National Taxpayers Union, called on political leaders to “remove government-enforced barriers to resilient diverse and secure supply chains, starting with the U.S. sugar program."
Supporters of the reform argue confectionery manufacturers already profit more than farmers
The U.S. produces 70% of the country’s sugar and yet ranks as the third largest importer of sugar, according to the American Sugar Alliance (ASA). This is primarily due to sugar subsidies and import taxes embedded into the U.S. sugar policy.
As sugar producers receive subsidies from the government in a program that makes it difficult for sugar producers overseas to compete, the price of sugar is significantly higher than the global market prices. When sugar producers have a surplus, the government purchases the excess to sell to other countries and ethanol manufacturers, among others, allowing companies that rely on raw sugar to purchase sugar at a lower cost than the global market rate. As a result, the organization argues that confectionery manufacturers make “more in profits in a month than American sugarbeet and sugarcane farmers make in a year.”
In April, the American Sugar Alliance urged policy leaders to implement a more efficient U.S. sugar policy that is “affordable and readily available” for consumers and supports the 11,000 beet and cane farmers across the country, adding $23.3 billion to the U.S. economy. The organization urged “members to examine how the farm safety net could be updated in the next Farm Bill for all Title I commodities to better match actual operating costs for producers."