WASHINGTON, March 12 (Reuters) - Foodmakers and refiner Imperial Sugar Co. asked the Agriculture Department on Wednesday to increase U.S. sugar marketing allocations by up to 300,000 short tons, or 3.65 percent, to assure adequate supplies.
Allocations were boosted to 8.2 million tons on Jan 10. The U.S. farm subsidy law calls for a quarterly review of marketing allotments.
USDA official Beth Bechdol said the government would announce later on Wednesday the reassignment of about 29,000 tons of cane allotments, now held by Hawaii and Puerto Rico, to Texas, Louisiana and Florida.
At a "listening session" called by USDA, the Sweetener Users Association, speaking for food and beverage companies, pointed to estimates sugarbeet production would fall short of its allocation by 242,000 short tons. USDA should take steps promptly to boost the sugar supply "equal to any beet sugar deficit."
Imperial Sugar Co (IPSU,Trade)., based in Houston, Texas, said marketing allocations should be increased by 300,000 tons to forestall any squeeze on supplies or price spikes.
Growers, speaking through the American Sugar Alliance, said USDA should move cautiously and not flood the market.
As part of the meeting, sugar growers said USDA should continue to run the sugar program in its current form. There was no need, they said, "to burden the secretary (of agriculture) with specific triggers" for setting or changing allocations.
Foodmakers said the industry and consumers would be served best by a policy that was relied on triggers such as the stocks-to-use ratio. The Sweetener Users Association said USDA should aim for a 15.5 percent ratio, rather than the 14.5 percent implied by recent actions.
Imperial Sugar said USDA seemed to be aiming for a ratio as low as 11 percent, which would unduly pinch supplies and raise prices.
By law, USDA must operate the sugar support program at no net cost to the taxpayer. The sugar program guarantees a minimum price for domestic sugar. USDA has some leeway to limit imports and can assign marketing allotments to prevent processors from defaulting on the loans that assure the minimum price to growers. |
