American farmers suffer when foreign countries dump heavily subsidized surplus sugar on the world market to protect their own interests, said American Sugar Alliance (ASA) economist Jack Roney in a radio interview.
“The Farm Journal Report” segment with Roney aired Aug. 22, and it focused on the need to maintain a strong no-cost sugar policy in the upcoming Farm Bill amid a rising tide of market manipulation by foreign governments.
Roney explained to the show’s host, Darrell Anderson, that American producers are efficient and competitive while providing good jobs and maintaining the world’s highest environmental standards.
The industry is responsible for $20 billion in annual economic activity and 142,000 jobs across 22 states.
“What is frustrating to us is that many foreign countries heavily subsidize their producers,” Roney explained. “They overproduce, and then they dispose of their surplus by dumping it onto the world market to keep their own domestic markets strong. And what U.S. sugar policy basically is all about is trying to keep that subsidized dumped foreign sugar from flooding our market and putting our efficient producers out of business.”
Among the world’s worst subsidy offenders are Brazil, Thailand, India, and the European Union, with subsidies ranging from $665 million per year, in Europe’s case, to more than $2.5 billion in Brazil’s.
Mexico is another major subsidizer, and it was found guilty by the U.S. government for violating U.S. trade law and dumping subsidized sugar in America. A settlement was reached in June to finally bring Mexico into compliance with U.S. law.
By comparison, American sugar farmers don’t get subsidy checks, Roney noted. Instead, producers have access to loans that help them make ends meet while they market their sugar, then store it until it is needed by the customer.
Because these loans are repaid with interest, U.S. sugar policy has historically operated without taxpayer expense – something Roney says farmers would like to continue in the next Farm Bill.
“It’s a zero-cost policy,” Roney said. “Costs taxpayers nothing and U.S. consumers pay among the lowest prices for sugar in the developed world.”
He also told the show about the Zero-for-Zero sugar policy introduced by Congressman Ted Yoho (R-FL). Under the plan, which has been endorsed by ASA, the no-cost U.S. sugar policy would be rolled back in exchange for the elimination of foreign subsidy programs. This subsidy ceasefire would facilitate a free market for sugar around the globe.
