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Sugar Policy Issues (CRS Report for Congress)

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Release Date Revised May 12, 2006
Report Number IB95117
Authors Remy Jurenas, Resources, Science, and Industry Division
Source Agency Congressional Research Service
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Summary:

On May 10, 2006, the Senate Agriculture Committee held a hearing to review theimplementation of the sugar provisions of the 2002 farm bill. The U.S. Department ofAgriculture's Undersecretary stated that the sugar program operated relatively smoothlythrough July 2005, but characterized it as "highly prescriptive, containing many rigid, andsometimes contradictory, rules" that increased the complexity of program administration.He noted that developments in the U.S. and Mexican sugar sectors after NAFTA takes fulleffect in January 2008 mean "alternative [sugar policy] approaches will need to be explored."Anticipating upcoming debate on the next farm bill, sugar crop growers, processors, andmost cane refiners stated that they will seek an extension of the current program, arguing thatexisting policy works well and has provided supply stability. Sugar users (food and beveragemanufacturers) called for changes that would allow the program to operate more flexibly, andwant to "explore common ground" with the sugar producing sector. The president of theonly independent cane refinery expressed concern about two issues that current policy doesnot handle well, which he would like addressed in the 2007 farm bill. A spokesman for thesugar industry of Mauritius, one of the 40 countries with a share of the U.S. import quota,emphasized how important continued access to the U.S. market is for the stable revenue flowand positive developmental impact provided by the U.S. program's price premium.
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