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WASHINGTON—A U.S. sugar representative told a gathering of worldwide sugar leaders yesterday that the American sugar industry is facing extreme challenges and is vulnerable to further downsizing unless government officials act in a responsible manner next year.

The hardship has been brought about by higher input costs for sugar producers, a market burdened with unneeded subsidized foreign sugar, and more than two decades of flat prices, Jack Roney, the American Sugar Alliance’s director of economics and policy analysis, explained at the International Sugar Organization’s annual meeting in London.

“American sugar producers require a higher price environment to survive and a firmer hope that their government will not further negotiate away their access to the U.S. sugar market,” he said.

More than half the sugar factories operating in 1985 have closed because of economic pressure and more have recently announced plans to shut down. But there is some optimism within the industry, according to Roney.

Sugar policy in the 2008 Farm Bill should help lessen the impact of today’s challenges “at little or no cost to taxpayers, and to the benefit of U.S. energy independence, food security, and environmental quality,” he told the group.

There is also hope that President-elect Barack Obama will be more favorable to sugar producers than past Administrations, he said.

Prior to the presidential election, the sugar industry received a letter from Obama that read: “I recognize the hard work and contributions you make as America’s sugar growers. I believe we should reward your hard work with policies that will keep your industry and your communities strong.”

Roney concluded by saying sugar should remain a mainstay in rural communities unless the government takes actions next year to rollback parts of the 2008 Farm Bill or further increase sugar imports. America is already one of the world’s biggest buyers of foreign sugar.

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