Sugar policy reform bills attract industry support

Sugar policy reform is back on the US legislative agenda, as two new bills that aim to end the sugar price support program have attracted broad food industry support.

The Free Market Sugar Act was introduced by Rep. Joe Pitts (R-PA) and Rep. Danny Davis (D-IL) on Wednesday, a week after Senator Dick Lugar (R-IN) introduced his Free Sugar Act of 2011.

The American Sugar Alliance, which represents the interests of sugar growers, claims that US sugar policy“hasn’t cost taxpayers a dime since 2001” – but Lugar says that the policy creates a hidden sugar tax.

“Every American business that makes candies, ice cream, cookies, bread, or sells lattes, sandwiches, or cupcakes, is paying more than twice the world market price for sugar because of this hidden tax,”“American consumers pay for this tax, while more and more sugar users are being driven out of business because of off-shore producers who don’t have to pay high prices dictated by the US government.” Lugar said.

Current US sugar policy was set with the 1981 Farm Bill and works on the principle that supply should not exceed demand in order to keep prices stable. The government can restrict the amount of sugar that American sugar farmers can sell, restrict the amount that the US will buy to the level required by trade obligations, and divert excess sugar to ethanol production.

However, US sugar prices have remained far above global sugar prices – a situation that has led to frustration among sweetener users who claim that costs are unacceptably high.

Commenting on the bipartisan Free Market Sugar Act, president of the National Confectioners Association and chairman of the Coalition for Sugar Reform, Larry Graham, said: “American consumers and manufacturers have been harmed by the current sugar program for far too long. This legislation will help bring an end to unnecessary and wasteful federal government intrusion.”