Sugar Growers Applaud USDA Purchase

May 16, 2000

Sugar farmers are applauding USDA’s decision to purchase 150,000 short tons of sugar to prevent forfeitures of large quantities later this summer. The action is consistent with previous attempts to aid farmers, says the American Sugar Alliance.

Ray VanDriessche, Michigan farmer and president of the American Sugarbeet Growers Association, said, "We are certainly gratified by the administration’s response to the severe economic crisis faced by American sugar farmers, and we fully recognize and appreciate that this action is taken in the public’s interest. We feel certain, too, that the administration will take further action, as needed, to avoid costly forfeiture of sugar under loan to the government."

Without the purchase, said VanDriessche, the federal government would be exposed to forfeiture of sugar valued at more than $550 million with annual storage costs of $30 million.

Jack Roney, director of economics for the ASA, said that the lower sugar prices can be attributed to the threat of increased sugar coming in from Mexico after Oct. 1; expanded acreage devoted to sugar because of a price "crisis" in other commodities; extremely favorable weather conditions for two consecutive years, and a delay by USDA last fall in announcing the import quota for the year that caused uncertainty in the market and depressed prices.