Lugar Calls Sugar Buy a `Sour Plan’

May 15, 2000

Senate Agriculture Committee Chairman Richard Lugar (R-IN) calls USDA plans to buy 150,000 tons of sugar "a sour plan that would fail to correct the greater problems created by a scandalous federal sugar program." The buy only will stimulate more sugar production, "adding to the problem," said Lugar.

The problem is created by a sugar policy that guarantees a price to producers that is two to three times the world market price, Lugar adds. "Without the guide of market signals, we will be destined to over-produce sugar. The policy is a failure and should be ended," he said. Lugar long has opposed the program.

Lugar said he is considering legislation to stop the purchase and instead dedicate the funds to buying farm land in the Everglades agricultural area. "Sugar grown in the Everglades agricultural area is wreaking havoc with the environment," he said. "If USDA is going to spend taxpayer money to cut sugar supply, then it should finance a permanent reduction of production that also benefits the environment."

The chairman said the federal sugar program creates a price for U.S. sugar substantially higher than the world market price by restricting imports of foreign sugar and making loan payments to farmers for each pound produced. Those loans are 18 cents per pound for cane sugar and 22.9 cents per pound for beet sugar.