U.S. Sugar Program Fundamentals [April 22, 2015]   [open pdf - 395KB]

"The U.S. sugar program provides a price guarantee to producers of sugar beets and sugarcane and to the processors of both crops. The U.S. Department of Agriculture (USDA), as program administrator, is directed to administer the program at no budgetary cost to the federal government by limiting the amount of sugar supplied for food use in the U.S. market. To achieve both objectives, USDA uses four tools--as reauth orized without change by the 2014 farm bill (P.L. 113-79) and found in chapter 17 of the Harmonized Tariff Schedules of the United States-- to keep domestic market prices above guaranteed levels. These are: [1] price support loans at specified levels--the basis for the price guarantee; [2] marketing allotments to limit the amount of sugar that each processor can sell; [3] import quotas to control the amount of sugar entering the U.S. market; [4] a sugar-to-ethanol backstop--available if marketing allotments and import quotas are insufficient to prevent a sugar surplus from developing, which in turn could result in market prices falling below guaranteed levels. To supplement these policy tools in supporting sugar prices above government loan levels, while avoiding costly loan forfeitures, important administrative changes were adopted in late 2014. These included imposing limits on U.S. imports of Mexican sugar and establishing minimum prices for Mexican sugar imports, actions that fundamentally recast the terms of bilateral trade in sugar."

Report Number:
CRS Report for Congress, R43998
Public Domain
Retrieved From:
National Agricultural Law Center: http://nationalaglawcenter.org/
Media Type:
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