The sugar industry is wary of a deal between the U.S. Commerce Department and the Mexican government on sugar imports from Mexico, The Courier reports.
The deal, negotiated by U.S. Commerce Secretary Wilbur Ross and Mexican Economy Minister Ildefonso Guajardo, seeks to end what the U.S. sugar industry and international trade courts call “unfair trade practices.â€
Mexican dumping of refined sugar has caused a $4 billion loss for the entire U.S. sugar industry over the past four years, industry and government officials estimate. The new deal will limit the amount of refined sugar Mexico can send to the U.S. while increasing the amount of unrefined sugar it can send. The price will increase slightly, and the agreement lowers the percentage of refined sugar Mexico can send to the U.S. to 30% of its exports, down from 53%.
Phillip Hayes, a spokesman for the American Sugar Alliance, says part of the deal has sugar producers worried. One segment allows Mexico to fill any additional U.S. needs for sugar, allowing it to go over the 30% limit in the deal.
Hayes says Mexico could use this provision as a loophole to continue dumping sugar into American markets. He adds that he’ll be working with Ross to try to close the loophole.
Jim Simon, general manager of the Thibodaux-based American Sugar Cane League, which represents Louisiana sugar cane producers, agrees with Hayes that the loophole needs to be closed.
“All in all it’s an OK agreement, but there is a provision in the agreement that we are skeptical of that could allow Mexico to continue its dumping practice,†Simon says. “It’s an agreement in principle so the details are still being worked on. So we’re hopeful that loophole will be closed, but we’re not certain that the final agreement will rectify that problem.
