Proposed sugar bill could end national program

ONTARIO — Sugar beet producers who have been fighting to continue use of “Round-up Ready” beet seed, which has become the industry standard in helping weed control, now face another challenge.
Wednesday, U.S. Sen. Richard Lugar introduced a bill to end the U.S sugar program that puts a floor under prices paid to sugar producers by providing stable prices and providing help when prices drop too low.
Sugar prices are supported by a system in which the U.S. Department of Agriculture sets the amount of foreign sugar imported each year, duty free, and how much of the American market is allocated to American sugar producers, which can be no less than 85 percent.
On his website, Lugar said his “Free Sugar Act would create a free market in sugar, free small businesses and consumers from paying government-inflated food prices, and free sugar producers from the commands of Washington.”
“Currently, U.S. sugar prices are at or near all-time record highs,” Lugar says. “The U.S. sugar program raises U.S. prices well above the world sugar price, forcing U.S. consumers, small businesses and food manufacturers to pay more for sugar than their foreign counterparts.”

On the world market, people pay 34 cents per pound for refined sugar — 20 cents less than Americans pay because of the U.S. sugar program, Lugar maintains.
“These artificially high domestic sugar prices are especially costly for American small businesses like bakers, candy-makers and restaurants … and it hurts U.S. food manufacturers that compete with imports that benefit from lower world sugar prices.”
However, sugar industry spokesmen have said, through the years the world sugar market is using excess sugar dumped into the market by other producing nations, which subsidize their sugar industries.
A report prepared by McKeany-Flavell Company in 2009 said quality standards become an issue if the U.S., a net importer of sugar, depends more on world market sugar, and that U.S. processors offer screening to ensure granulation size. Uniform size is critical to certain food or beverage applications, the report said. Another issue, it said, is traceability, with domestic sugar supplies providing proper paperwork with each load of sugar delivered to buyers.

“If the U.S. sugar industry disappeared, besides issues of quality, other problems could occur with delivery and/or replacement of sugar, especially if it arrived outside specification,” the report for the American Sugar Alliance said.
While sellers of imported sugar can provide proof of origin and, in some instances, of the sugar mill from which it was purchased, the detail necessary for traceability can be difficult, especially if multiple origins or sugar mills are involved, the McKeany-Flavell report said.

(Source: http://www.argusobserver.com/articles/2011/04/01/news/doc4d96078b95dad921465362.txt)