Sugar industry representatives yesterday urged a House committee considering a Latin American trade agreement, known as the Free Trade Area of the Americas or FTAA, to utilize instead the multilateral World Trade Organization (WTO) to address disciplines in sugar trade.

Jack Roney, Director of Economics and Policy Analysis for the American Sugar Alliance, told members of the House Agriculture Committee, “Only a comprehensive approach will restore the world sugar price to a level that reflects the actual cost of producing sugar, and that means addressing the rampant market distortions governments employ in the only comprehensive forum available in trade negotiations today, the WTO agricultural negotiations now underway in Geneva.”

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Roney was accompanied by Jackie Theriot, President of the American Sugar Cane League, based in Thibodaux, Louisiana. The American Sugar Alliance is a national coalition of growers, processors and refiners of sugarbeets, sugarcane and corn for sweetener, based in the Washington area.


Roney said that since 1986, the U.S. sugar industry has endorsed the goal of “genuine, multilateral free trade in sugar…We are ready, willing, and able to compete with foreign farmers on a level playing field.” He made a point of noting, however, “We cannot endorse free trade at any cost, nor do we endorse unilateral disarmament of U.S. agricultural policies. Progress toward free trade must be made on a fair, genuine and comprehensive basis.”


Roney gave five reasons why the U.S. sugar industry is in favor of reserving sugar for WTO disciplines:



  1. FTAA countries already dominate U.S. sugar imports. Twenty-two of the 41 countries that share in the U.S. sugar import quota are FTAA countries. They enjoy essentially duty-free access at the preferential U.S. price.
  2. The sugar industries of FTAA countries are likely to be overrun with subsidized Brazilian sugar. Brazil has quintupled its sugarcane production since 1975, and recently became the world’s leading sugar producer and exporter. Brazil has done so with the aid of an estimated $3 billion per year in ethanol subsidies, strategic currency devaluations, debt reduction programs, low environmental and labor standards – including the widespread, deplorable use of child labor – and still other subsidies. Other governments in the Americas know that without removing the Brazilian subsidies, Brazilian sugar will simply swamp the U.S. and other FTAA markets.
  3. Sugar is not included in most bilateral and regional agreements because of the distorted nature of domestic and export markets for sugar and because of a wide range of border control issues. There are 124 regional trade agreements worldwide, and most of them exclude sugar.
  4. Increased potential for import-quota circumvention. Bilateral and regional trade agreements have tended to foster the creation of schemes for blending dump market sugar with products that are not subject to import quotas and shipping these concoctions throughout the free trade area.
  5. The U.S. sugar market is already oversupplied, and does not need any additional foreign sugar through the FTAA.

Urging caution in approaching sugar trade negotiations, Roney said, “We must ensure that commitments in one region do not make achieving results in other regions difficult or impossible. This is not an issue when dealing with trade distortions on a comprehensive basis in the WTO….The U.S. sugar industry strongly recommends that, within the framework of the FTAA, sugar be reserved for much needed, and more far-reaching, disciplines in the multilateral, WTO context.”

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For more information on U.S. sugar policy, visit www.sugaralliance.org