When the Mexican sugar lobby testified before the U.S. International Trade Commission (ITC) in April as part of an ongoing investigation into Mexico’s unfair trading actions, they told ITC commissioners that no disciplinary actions would be necessary.
That’s because Mexico had agreed to redirect shipments of subsidized sugar to other countries instead of the United States, according to witnesses. Big candy companies and others who support Mexico’s dumping and subsidization parroted this promise and pointed to it as evidence that all would be okay.
But there was one big problem. Mexico is doing the exact opposite of what it promised. Mexico is actually accelerating exports of subsidized sugar to the U.S. and further injuring U.S. sugar producers.
The U.S. Department of Agriculture (USDA) now believes Mexico is redirecting to the world market only half of the nearly 1.2 million metric tons of sugar it had promised it would. And the USDA continues to increase estimates of subsidized and dumped sugar expected to enter the United States.
In fact, the USDA estimates that Mexico sent an astounding 300,000 tons of sugar to America in May alone, setting an all-time record for shipments in a single month.
And that’s helped put Mexico on pace to break last year’s record shipment of 2.1 million tons. So far this year, Mexico has dumped nearly 1.6 million tons of subsidized sugar on the U.S. market, compared to 1.04 million tons over the same period last year.
To the ITC’s credit, they didn’t let Mexico’s lofty promises cloud their judgment, voting 5 to 0 in a preliminary ruling against Mexico. A detailed report released after that vote proved that the ITC recognized the injury Mexico is inflicting on American farmers and taxpayers.
The Department of Commerce is also investigating Mexico and has noted strong evidence that subsidies and dumping are giving Mexico an unfair edge over more efficient U.S. producers.
Here’s hoping these U.S. government investigations conclude as soon as possible and apply disciplinary actions against Mexico to level the playing field. After all, the U.S. market can’t sustain many more months of May-like flooding.