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Published April 07, 2014, 09:50 AM

Secretary says sugar producers' legal issues 'ill timed'

WASHINGTON — Agriculture Secretary Tom Vilsack said on April 3 he fears the legal case U.S. sugar producers have filed asking for corrective action could affect other negotiations with Mexico, but a spokesman for the sugar growers said the case is justified.

By: Jerry Hagstrom , Agweek

WASHINGTON — Agriculture Secretary Tom Vilsack said on April 3 he fears the legal case U.S. sugar producers have filed asking for corrective action could affect other negotiations with Mexico, but a spokesman for the sugar growers said the case is justified.

At a House Agriculture Committee hearing, Rep. Richard Nolan, D-Minn., told Vilsack he was hoping that he would be “supportive” of the antidumping and countervailing duty petitions that U.S. sugar producers filed March 28 with the International Trade Commission and Commerce Department, alleging that the Mexican industry had shipped sugar to the U.S. at prices 45 percent below the cost of production or more and has received substantial subsidies from Mexican federal and state governments.

“I’ve got to be candid with you,” Vilsack replied. “From my perspective, it is a bit ill timed I am not suggesting there isn’t an issue. There is.

“I think the Mexicans have identified their willingness to work on this by redirecting 700,000 tons of sugar that they would have put into the United States into an export opportunity elsewhere.”

But he said, “We are at a very delicate circumstance with Mexico on a variety of issues. I am sure they don’t see this as a particularly friendly gesture. In a perfect world, I would liked to have seen this perhaps not occur or not occur at this time.”

Working on several issues

Speaking to reporters after the hearing, Vilsack noted that the U.S. has been negotiating with Mexico on a range of agricultural issues and that Mexico has recently agreed to accept U.S. potato imports throughout the country. The country-of-origin labeling (COOL) of red meat case also is pending, he noted.

He also pointed out that Mexico is importing large quantities of high fructose corn syrup and said the Mexicans might ask why they are importing so much when a sugar case is launched against the country.

Philip Hayes, a spokesman for the American Sugar Alliance, said that while U.S. cane and beet producers are “very thankful” for the work Vilsack has done to stabilize the market, the action the Mexican government took “was temporary and too little, too late” and that the case is designed to force the government to enforce U.S. law against subsidized imports.

“Mexico increased its dumped and subsidized exports to the United States by 1 million tons from 2012 to 2013, crashing U.S. market prices, forcing USDA to remove 1 million tons of sugar from the U.S.market, and injuring U.S. farmers, sugar producers and taxpayers,” Hayes said.

“Now it appears to be accelerating shipments into the United States this year, far faster than USDA predicted,” he said. “So far, Mexico has sent nearly 900,000 tons of the 1.7 million tons the USDA has predicted for the entire year. At this rate, the U.S. market could be looking at over 2 million tons total this year.”

Hayes said, “U.S. trade law is designed to stop this injury and we are simply asking the U.S. government for the remedies provided by U.S. law. We are confident that U.S. government officials will enforce U.S. law objectively and vigorously.”

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