No Evidence that Sugar Program Hurts Sugar-using Companies

(Russell Nemetz / Montana Ag Network) – A new report has found that U.S. sugar prices do not impede the financial performance of sugar-using firms. And the report’s data is good news for this region’s sugar beet growers.

The analysis conducted by four agricultural economics professors at the University of Tennessee and Oklahoma State University rejected claims from sugar-using firms “that as the U.S. price of sugar increases relative to the world sugar price, this has a negative effect on their profits.

The American Sugarbeet Growers Association’s Luther Markwart says the analysis confirms what their industry has known for years.

“For decades, our customers have always kind of picked at U.S. sugar policy saying, hey, the price is too high” said Markwart. “If we could just get lower sugar prices, we would be able to pass that on to consumers. And we’ve heard that for 50 years. And the fact of the matter is that’s not true.”

The COVID-19 pandemic has highlighted the importance of essential products like sugar.

To give you an example, when the U.S. put itself essentially into a self-imposed economic coma for a couple of months, you had hoarding at the grocery stores” said Markwart.

“You pivoted from 650,000 restaurants to 40,000 grocery stores. During the hoarding, everybody came in and cleared out sugar, flour, toilet paper, all that stuff. So, we simply pivoted over the course of a couple of weeks of sending a little less to commercial manufacturers and more to the consumers.”

He says U.S. sugar farmers and workers are proud to provide their customers with more than 60 different types of affordable and sustainably produced American sugar.

“What this pandemic has shown us is that you can’t take it for granted and bless all of those farmers and factory workers that are growing and preparing our food for us” said Markwart. “So, salute American farmers as American heroes.”

The American Sugar Alliance and American Sugarbeet Growers Association say that U.S. sugar farmers and workers need a strong no-cost sugar policy to give them a fighting chance against excess foreign imports that threaten their ability to produce sugar domestically.