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.
Never mind the dozens of news stories chronicling expansions here in the United States, and never mind the hundreds of stories of U.S. confectioners banking record profits, sales growth, and an enviable recession-proof status.
Candy lobbyists want lawmakers to believe the U.S. sugar policy is causing them to teeter on economic collapse. And they are willing to repackage really old material to pull one over on Capitol Hill.
The centerpiece of their argument is a Department of Commerce paper about job flight that’s nearly 10 years old. It uses data from the late ’90s to the early ’00s and fails to mention that during the same period U.S. based confectioners actually increased production thanks to automation and efficiency gains.
Big Candy also loves to point to a flier from the Canadian government advertising Canada as a good home for U.S. food manufacturers.
This flier, which was recently distributed at a Capitol Hill briefing, is proof that confectioners are fleeing America because of sugar policy, candy lobbyists say.
Two problems. The handout is a decade old, and today the exact opposite is happening in the marketplace.
Canadian sugar users have closed factories since this flier was produced and have shifted production to other plants in the U.S. and Mexico. Smucker’s, for example, has shifted an operation from Canada to Wisconsin and Wrigley has announced plans to shift a facility from Canada to Georgia next year.
An April 23 article in the Western Producer touched on the issue:
First, there’s the closure or downsizing of several food processing plants that put people out of work: Heinz in Leamington, Kelloggs in London and Smucker’s and Lance Canada Ltd. In total, 105 plants closed in Ontario from 2008-14.
Of course, U.S. sugar producers aren’t like our legislative opponents. We would never claim that these Canadian companies are moving for the sole reason of sugar prices. After all, sugar only constitutes 1% to 3% of a candy bar’s retail cost.
Relocation decisions are the result of numerous factors like the labor pool, employee wages and benefits, regulatory burdens, taxes, infrastructure, access to customers, energy costs, and currency values.
Sugar prices in Canada, the U.S., and Mexico are very similar. So chances are good that sugar played no more of a role in these recent Canadian decisions than it did when some U.S. confectioners moved elsewhere 10+ years ago.
Bottom line, the U.S. food-manufacturing sector is strong and adding jobs, and confectioners are leading the pack in profitability.
One would think Big Candy lobbyists would want to share this good news with lawmakers instead of spinning the opposite story with dated material in an attempt to outsource America’s sugar sector and the 142,000 U.S. jobs it supports.