FOR IMMEDIATE RELEASE: February 9, 2015
CONTACT: Phillip Hayes, 202-507-8303
WASHINGTON—U.S. sugar policy is expected to cost taxpayers $0 from FY2015 to FY2025, according to projections released last week by the United States Department of Agriculture (USDA).
Sugar policy is the least expensive major commodity policy in the Farm Bill because farmers repay loans with interest instead of receiving subsidy checks. It ran at no cost to taxpayers from 2003 to 2012 and again in 2014.
There was a net cost of $259 million in 2013 when the USDA had to take emergency action to prevent the market from collapsing after Mexico dumped a record amount of subsidized sugar onto the U.S. market.
“If the estimates hold true, it will mean that sugar policy would have run without cost for 22 of 23 years. That’s an incredible track record,” said Jack Roney, an economist with the American Sugar Alliance.
Roney explained that this projection is also a testament to the strength of the antidumping and countervailing duty suspension agreements reached between the U.S. and Mexican governments in December to stop Mexico’s unfair trading practices from further harming Americans.
Under the Farm Bill, Congress directed the USDA to run sugar policy at no cost to taxpayers. And the suspension agreements enable them to achieve that goal, explained Roney, who will address the International Sweetener Colloquium, which is being hosted this week by the Sweetener Users Association at the Waldorf Astoria in Orlando, Fla.
Michael Scuse, USDA Under Secretary for Food and Foreign Agricultural Services, referenced the suspension agreements in a speech today at the Colloquium.
In response to a question about the return to zero cost, Scuse said, “We strongly support the suspension agreements so that we do not repeat the costs of 2013.”