WASHINGTON—The sugar surpluses that are overhanging the U.S. market, and sending sugar prices plunging, continue to rapidly climb, according to data released today by the U.S. Department of Agriculture (USDA).
Surplus stock figures for the year ending Sept. 30, 2012, increased from 1.7 million tons to 2 million tons, the USDA noted. Estimated surpluses for the year ending Sept. 30, 2013, grew from 1.6 million tons to 2.2 million tons.
For perspective, 2.2 million tons would be enough leftover sugar to give every American an additional 14pounds on top of what they already consume.
The new surplus figures are the highest on record since 2000. If there is any silver lining for sugar producers in the latest news, it might be found on Capitol Hill.
Large candy companies, which are the biggest opponents of no-cost U.S. sugar policy, now will have little to complain about when lobbying lawmakers. The price of sugar has been their justification for suggesting America weaken its support of domestic growers in the next Farm Bill and instead become more dependent on subsidized imports.
“Big Candy says it needs rock bottom prices with surpluses as far as the eye can see, and it has spent millions of dollars lobbying Congress with the message that the no-cost US sugar policy stands in the way of that goal. Now that their wish has come true, perhaps they can acknowledge that current U.S. policy is not thebogeyman they pretend and can stop lobbying to put U.S. farmers out of business,” said Phillip Hayes, spokesperson for the American Sugar Alliance. “U.S. sugar producers desperately need Congress to renew no-cost sugar policy if they are going to have a chance to survive.”
Hayes noted that despite the rapidly falling cost of sugar, large food makers continue to charge more for sweetened products in the grocery store.
“They are padding their profits right now,” he said. “Most people are surprised to learn that confectioners actually have higher profit margins than major oil companies and even casinos.”
The United States is already the largest sugar importer in the world. Those imports, combined with unexpectedly large deliveries from Mexico and a strong domestic crop, have created the oversupply situation.