Category Archives: The Sugar Beat

Big Candy’s Odd Litmus Test for Policy Support

Last week, the candy industry’s lobbying arm sent an email to select Hill offices informing lawmakers that not every state had sugar-related jobs.

Duh. That’s pretty obvious. Sugar can’t be grown in every state because of climate and soil conditions.

Major Sugar Exporters Seek Global Subsidy Reform, U.S. Critics Fixate On Unilateral Disarmament

In an amazing twist, some of the world’s biggest sugar subsidizers signaled a desire to start a conversation about rolling back global subsidies to help make the market freer and fairer.

Sounds promising, except for the fact that a couple of vocal U.S. politicians were simultaneously signaling their desire to simply end U.S. sugar policy and reward subsidizers with more U.S. market share, thus foregoing any chance of worldwide reform.

Stakes On The Global Stage Are High. So Let’s Focus On…Sugar?

The President of the United States is in Europe discussing a global climate accord, which will hold economic and political ramifications for generations to come. Foreign allies are debating enhanced military involvement in the war on terror. Violence has gripped many U.S. cities. Racial tensions are flaring. A leading measure of U.S. manufacturing just fell to its lowest level since the recession, and overall business investment is slumping, dragging down the economy.

And at least two DC figures – Republican Congressman Joe Pitts and Grover Norquist – are screaming at the tops of their lungs this week that Congress must drop everything and focus on one key issue immediately: U.S. sugar policy.

India Tops Off a Subsidy-Filled Year with Yet Another Subsidy

With all of the excitement of the past month in the world of agriculture – including a secret attack on crop insurance, sugar policy’s bizarre mention in a presidential debate, anti-farmer forces angling to reopen the farm bill, and Thanksgiving – some important foreign subsidy news almost went unnoticed. Almost.

Promises Kept or Promises Broken?

Congress made a promise to rural America when it passed the 2014 Farm Bill, which was the bi-partisan product of more than three years of careful deliberation and 40 hearings.

Although the 2014 Farm Bill reduced spending by $23 billion, lawmakers promised farmers that the bill would still provide them a strong five-year safety net to manage extreme weather and wild price swings caused, in part, by foreign subsidies and market manipulation.

Peculiarities of Presidential Politics

The road to the White House is long and twisting indeed, and it has taken some unusual turns so far. Candidates have discussed fantasy football, their undergraduate college years, competitors’ physical appearances, who’s really the most successful, inheritances, and who saw whom in the green room before a television appearance.

Little of this noise affected agriculture though, until this week’s Republican Presidential debate made an unexpected detour down a rural country road. Sen. Ted Cruz (R-TX), a well known opponent of agriculture (including ethanol and crop insurance), amazingly proclaimed that he wanted to reopen the Farm Bill and end U.S. sugar policy in order to boost defense spending.

We See Your True Colors Shining Through

The past couple of weeks have been challenging, gratifying, and enlightening for the agricultural community.

Challenging in that an 11th hour, secret deal struck as part of a budget package contained crippling cuts designed to gut the crop insurance system on which so many farmers depend. In other words, the five-year contract that Congress signed with rural America as part of the 2014 Farm Bill would have been ripped to shreds before its effects were ever really felt.

Gratifying in that farmers from coast to coast quickly joined forces to lock arms and fight back when attacks surfaced. First, in a herculean lobbying effort to effectively beat back crop insurance cuts. Then, in sending a clear signal to anti-farmer forces angling to reopen the Farm Bill to target U.S. sugar policy.

Candy Profits Are Scary Good This Halloween

In the early 1900s, the candy industry was starting to see big sales around Christmas and Easter. But there was a gaping hole in the fall sales season. So industry leaders hatched a plan in 1916 to boost profits in October.

They concocted a holiday called (not so subtly) “Candy Day.” The Atlantic wrote an article all about Candy Day in 2010, and the publication unearthed some interesting materials from the National Confectioners Association, including these little ditties from 1916:

Sugar Policy Critics Raking in the Dough

Ever since debate over the most recent Farm Bill began, large food manufacturers have been crying poor. It’s been the same old story since the debate began around 2011, and it continues even today as these companies lobby to reopen the recently passed Farm Bill.

Sugar policy, these critics say, is causing them financial pain, and the only way to rectify the situation is to outsource U.S. sugar production and let heavily-subsidized foreign producers flood the market with cheap sugar.

The Power of Community

U.S. sugar production spans hundreds of communities in 22 states, supports 142,000 jobs, and pumps $20 billion a year into rural America.

At the American Sugar Alliance, we often cite big, national figures like these to drive home the importance of maintaining a strong sugar policy and supporting an important industry that helps feed the country.

ASA Chair Takes On Sugar Policy Critics In New Video

Luther Markwart, executive vice president of the American Sugarbeet Growers Association, was elected chairman of the American Sugar Alliance on Monday. And he wasted little time in jumping to the defense of all U.S. sugar producers.

#ICYMI: Hawaii sugar industry provides case study for TPP negotiators

By simultaneously rolling back sugar subsidies and trade-distorting policies in all countries – including America’s no-cost policy – the global price of sugar will naturally rise to reflect the cost of producing the crop.

U.S. Sugar Producers Excel in Another Measurement of Efficiency

Besides exposing Thailand’s $1.3 billion a year in sugar subsidies, Antoine Meriot also made another valuable observation in his recent study. It compared the efficiencies of sugar makers, noting, “Thai sugar producers are relatively inefficient compared with other major producers, such as leading exporter Brazil.” Specifically, Meriot used sugar recovery rates – a measurement of…

USTR Stands Strong with U.S. Sugar Producers

“We’re talking to all the parties, and sugar’s obviously a great sensitivity to our market here, and whatever we do in that area won’t undermine the sugar program.”

Big Candy’s Big Whopper About a Free Market

The Big Candy lobby and others who want to outsource U.S. sugar production and U.S. sugar jobs have criticized U.S. sugar policy for harming the “free market.”

Sugar critics base this talking point on people’s uninformed assumptions that the U.S. market is closed and that a global free market actually exists. But is American sugar really an impediment to free-market forces?

Big Candy’s Big Whopper About Taxpayer Cost

The Big Candy lobby and others who want to outsource U.S. sugar production and U.S. sugar jobs have publicly decried U.S. sugar policy because of its cost to taxpayers. Sugar critics base this talking point on a one-year anomaly. But is sugar policy really a drain on U.S. taxpayers? Not according to the U.S. Department of Agriculture, the Congressional Budget Office, or the Food and Agricultural Policy Research Institute – all of which agree that sugar policy will cost $0 over the life of the current farm bill.

Big Candy’s Big Whopper About Prices

The Big Candy lobby and others who want to outsource U.S. sugar production and U.S. sugar jobs have said that U.S. sugar policy harms consumers by keeping domestic prices higher than the rest of the world. Sugar critics base this talking point on the faulty assumption that cheap subsidized sugar from the “dump market” flows freely everywhere else in the world. But is foreign sugar really that cheap?

Big Candy’s Big Whopper About Jobs

The Big Candy lobby and others who want to outsource U.S. sugar production and U.S. sugar jobs have said that U.S. sugar policy threatens food-manufacturing jobs. Sugar critics base this talking point on a decade-old paper that used old press reports as its source. But are candy jobs really disappearing?

Sugar Producers Defend Free Markets on Chinese News Show

It’s not every day when the American affiliate of the predominant television broadcaster in Mainland China calls for an interview. And it’s even more rare when the topic the state-run network wants to discuss is how government intervention is wrecking global markets. But that is exactly what happened last week when Jack Roney of the American Sugar Alliance was invited to the set of CCTV America, the U.S. division of China Central Television News.

Fewer Foreign Sugar Subsidies, Not More, Is the Solution

What do you call an interest-free $940 million loan that likely will never have to be paid back?

Besides calling it one heck of a great deal, you could also call it a “subsidy.”

But in the case of some sugar mills in India, they call it “not enough.”

Thai Sugar Subsidy Spotlight

How was the Thai sugar industry able to achieve production gains while world sugar prices were falling?

Big Candy Details Dominance in Chicago

It’s not often when confectioners openly admit the success of their industry. After all, doing so cuts against the tales they spin on Capitol Hill of sugar policy causing economic hardship. But as the American Sugar Alliance’s compilation of good candy news demonstrates, Big Candy’s business has been firing on all cylinders since the most…

Brazil Should Take the Next Step to Zero-for-Zero Sugar Policy

For two years, U.S. sugar producers have pushed for a multilateral solution to the global sugar subsidies that have wrecked the global market.

Under this plan, known as the Zero-for-Zero sugar policy, sugar producers around the world would eliminate sugar subsidies and market-distorting policies so that a free market can form. And the World Trade Organization (WTO) is the logical venue for such reforms to be accomplished.

U.S. Sugar Producers Featured on U.S. Farm Report

Earlier this month, a national farming television program called the U.S. Farm Report ran a segment that used decades-old talking points about U.S. sugar policy to completely mischaracterize U.S. producers’ stance on trade. Sugar beet farmers who saw the show were rightly furious and contacted the show’s producers to set the record straight.

Living Off Subsidies and Still $3 Billion in the Hole

“Cane is just like a hen that lays golden eggs… We are sure that arrears will be cleared with government help.”

Food Manufacturing Jobs Head South of the Border…to the U.S.A.

One of Big Candy’s tired talking points against U.S. sugar policy is the fallacy that American food manufacturers are closing shop and heading to other countries because of U.S. sugar prices.

Big Candy Tries to Sneak Farm Bill Rider Onto African Trade Bill

The Big Candy lobby and its congressional allies launched a surprise attack against U.S. sugar policy on April 22. And it used a highly unusual vehicle in its attempt to sabotage the recently passed farm bill: an African aid package.

An amendment offered by Pennsylvania Republican Sen. Patrick Toomey would have used the African Growth and Opportunity Act to flood the U.S. market with unneeded sugar imports.

The Senate Finance Committee rejected the scheme on a 10-16 vote, with the panel’s top Republican and Democrat – Sens. Orin Hatch (R-Utah) and Ron Wyden (D-Ore.) – both opposing the plan.

Another Day, Another Bailout for India’s Subsidized Sugar Sector

A subsidized bailout package worth approximately $320 million was just announced for India’s struggling sugar sector.

But before we dissect the details of the latest subsidy handout, let’s first revisit India’s other big subsidy announcements this year, which are helping destroy the world sugar market.

Brazilian Candy Maker Breaks Ground in U.S.

We don’t have the same sugar subsidies as Brazil, so we can’t sell you sugar below the cost of production. But, we can promise you sugar of the highest quality, produced by efficient Americans and delivered on schedule to your door at a fair price.

Brazil’s Weak Currency Creates ‘Real’ Subsidy Problems

In February, the American Sugar Alliance unveiled a new online resource that tracks foreign sugar subsidies as part of its campaign for a free global sugar market. Since that time, the catalogue of media stories has been filled with news of an oversupplied world market where prices are far below average production costs. Fueling the…

It’s Easter Time

It’s that time of year again. Birds are chirping, trees are budding, and bulbs are flowering.

Small children are excited about spring break, egg hunts, and decorated Easter baskets.

And Big Candy is busy complaining on Capitol Hill even though they are selling more product than ever – more than $2.2 billion worth of candy this Easter alone.

NFU Maintains Sugar Policy Support at Annual Conference

Last week, the National Farmers Union (NFU) convened its annual convention to set policy positions for the country’s second largest farm organization over the next 12 months.   And part of that updated policy portfolio is continued support for America’s sugar farmers and the policy on which they depend.

Forming a Circular Firing Squad

There is little doubt that India’s ever-growing sugar export subsidies are a violation of World Trade Organization (WTO) rules. The new subsidies, detailed here by the USDA, have come under heavy scrutiny by other major sugar producers like Thailand.

India Responds to Subsidy Critics with More Subsidies

The global sugar community chastised India when it announced export subsidies last year that seem to be in clear violation of WTO rules. Those subsidies, which were set at $53 a ton in February and increased to $54 a ton later in the year, helped the country offload 2.8 million tons onto the already depressed global market in 2014.

India responded to the international criticism by upping the subsidy to $64 a ton in 2015.

Dear Big Candy: Leave the Farm Bill Alone

It was the subject of more than 40 congressional hearings and countless hours of careful debate. It was touted as a major bipartisan accomplishment of the 113th Congress. And the package will save taxpayers billions. Yet just one year after passage, and before many aspects of the 2014 Farm Bill have even been implemented, anti-agriculture…

How High Can it Go?

India’s sugar export subsidy is probably illegal under World Trade Organization rules, but that hasn’t stopped the country from – once again – making adjustments to it. And surprise, surprise, the adjustment will send the subsidy higher, not lower.

In late January, India’s food minister signed off on an export subsidy rate of 4,000 rupees ($64) per ton of raw sugar. That’s up from a subsidy of 3,300 ($53) rupees per ton, which was set in February of 2014 and then promptly increased to 3,371 ($54) rupees in August.

India exported 2.8 million tons of sugar last year with the aid of this subsidy, and this year, the Indian sugar lobby says it will need to offload about 2 million tons to keep domestic prices high.

Pot Calling the Kettle ‘Protectionist’

It’s no big secret that big candy companies like to badmouth sugar farmers for being “protectionist.”

Even though America is the world’s biggest sugar importer, the market is never quite open enough for the candy man’s liking. Heavily subsidized sugar grown by less efficient foreign countries with substandard labor, environmental, and safety standards should flow freely through America, even if it bankrupts rural businesses and farms, they contend.

Heck, the confectioner lobby has even bashed sugar producers for asking that U.S. laws be enforced to stop Mexico from dumping subsidized sugar onto the U.S. market and harming U.S. sugar producers and taxpayers.

Summarizing Sugar Policy

The American Sugar Alliance today sent all new Members of Congress a letter detailing the need for a strong sugar policy, the successful track record of the existing policy, and the importance of rejecting unilateral disarmament.

OPEC of Sugar Lives Up to its Name

With a dominant 50% market share of global sugar exports, Brazil can exert more control over prices than any other sugar producer. Brazilian subsidies and policy decisions affect consumers and farmers around the world, who are helpless to combat a behemoth whose primary goal is to increase its monopolistic reign.

It’s why Brazil is called the OPEC of sugar, and it’s why we were not surprised to read about how even decisions in Brazil’s gasoline sector can move sugar prices.

Farm Bureau Continues Sugar Policy Support

The American Farm Bureau Federation recently completed its 2015 annual convention and with it the group’s 2015 policy positions. The nation’s largest farm organization continued its supportive stance of U.S. sugar policy. The Farm Bureau’s position on sugar reads: We support: (1) A program to protect the interests of domestic sugar producers and recommend that…

Sugar and Candy, Making La. Sweet for Centuries

Louisiana sugar producers are fond of saying that their industry is older than the country itself.  Formed when Jesuit priests first planted the crop in New Orleans in 1751, the industry has survived hurricanes, droughts, and even a Civil War to grow into an economic engine.

Sugar is woven into the fabric of the state’s heritage arguably as much any other crop anywhere else in the country and even has a college football bowl game named after it.

Unfortunately, a proud tradition doesn’t always equate financial success, which farmers in south Louisiana have found out the hard way in recent years.  A flood of subsidized Mexican sugar was dumped onto the U.S. market sending prices spiraling, even as the price for things like equipment, seed, and fuel steadily rose.

Global Sugar Market to Stay Sour; Global Subsidies Rise

World sugar prices are depressed and are likely to remain in the doldrums over the coming year as surpluses overhang the market. That’s according to a Dec. 24 report issued by Rabobank, one of the largest banks in the world and key lender to the U.S. food industry.

Rabobank pointed to the growing cycle of sugar cane, which is a semi-perennial crop that prevents producers from quickly downshifting production, as a factor in the continued oversupply.

India Adds Loan Forgiveness to Its Growing List of Subsidies

Months after receiving preferential government loans, Indian sugar farmers soon will be allowed to walk away from their debts without repayment of either principal or interest, according to a Dec. 9 article by Bloomberg.

The outlet explained how some well-heeled agribusinesses are using the free money to expand at a time when the world sugar market is awash in a glut of subsidized surplus.

Mars Profile a Must Read

Things are going well for Mars, the maker of treats like M&Ms and Snickers.  A recent profile on the company by the Wall Street Journal summed it up this way:

While many U.S. food companies are closing factories and cutting staff, Mars Inc. recently opened its first new chocolate factory in the country in 35 years to feed Americans’ seemingly boundless hunger for sweets.

The $270 million plant boasts two production lines that can produce 8 million miniature Snickers candy bars and 39 million peanut M&M’s every day. At one end of the line, a waterfall of milk chocolate covers hundreds of tiny Snickers bars each minute, infusing the air with the smell of candy. The factory’s 500,000 square feet, kept carefully at 68 degrees so the chocolate doesn’t melt, include space for another three production lines so Mars can expand.

The article offered a small peak inside of a company that is privately held and usually keeps financial information close to the chest.

Mars discloses little about its finances, except to say that its annual revenue last year topped $33 billion—about 50% higher than in 2007, thanks largely to the 2008 acquisition of Wrigley. Chocolate is Mars’s second-biggest business globally, after pet care.

According to the Wall Street Journal, Mars is battling Hershey for a bigger slice of the U.S. chocolate market, growing from 24% to 28% over the past year.

Wall Street Journal Prints ASA Letter

Earlier this week, a longtime anti-sugar critic penned an article in the Wall Street Journal attacking U.S. sugar farmers and the policy on which they depend.

Fortunately, the newspaper brought some balance to the debate by publishing the American Sugar Alliance’s response to the article today.

Sugar Subsidy Escalation Harms Africa

A Wall Street Journal article published in October detailed how the sugar subsidy race between Brazil, India, Thailand, and even China is now hurting poor farmers in Africa.

“For much of the past decade, African and foreign sugar companies have pumped billions of dollars into projects in an attempt to tap the sweet tooth of the continent’s new middle class. Today, mills in many countries are grappling with unsustainable stockpiles. The glut has forced companies to reduce output, put on hold new sugar projects and shutter mills.

“The culprit: cheap imports. African nations import about 5 million metric tons of sugar every year, from countries such as Brazil, China and India. The imports—generally heavily subsidized—are sold at prices lower than the cost of producing sugar locally, prompting African countries to shun sugar from their neighbors.”

Global Subsidy Race Becoming a Three-Way Thai

We’ve spent a tremendous amount of time on these pages chronicling the massive run-up in sugar subsidies in Brazil and India. But one offender, Thailand, has largely gotten a pass…until now.

To better understand Thai sugar subsidies, it is important to first understand Thai sugar production.

U.S. Ends 2014 Crop Year with Surplus Sugar

All the little ghosts, goblins, and ghouls won’t have to worry about there being enough sugar to make their favorite Halloween treats this year.

That’s according to the U.S. Department of Agriculture, which recently reported that as of September 30, America’s sugar stocks-to-use ratio was 15.2%.

Indian Sugar Subsidies Grow Again

If you’ve developed a wicked case of whiplash keeping track of all the news about Indian sugar subsidies, you’re not alone.

Making it Rain…Chocolate

“It seems to be a good time to be a chocolatier,” a trade publication devoted to the candy industry recently reported.

In fact, according to the article, chocolate sales were up 24% from 2008 to 2013 and are expected to climb another 14% from 2014 to 2018.