 | This article needs to beupdated. Please help update this article to reflect recent events or newly available information.(November 2023) |
TheU.S. Sugar program is the federalcommodity support program that maintains aminimum price forsugar, authorized by the2002 farm bill (P.L. 107–171, Sec. 1401–1403) to cover the 2002-2007 crops ofsugar beets andsugarcane.[1]
Originally designed to protect the incomes of thesugar industry-growers of sugarcane and sugar beets, and firms that process each crop into sugar - the program now prevents them from competing with producers of corn syrup sweetener. It supports domestic sugar prices by:
Import restrictions are intended to meet U.S. commitments under theNorth American Free Trade Agreement (NAFTA) andUruguay Round Agreement on Agriculture. Processor and refiner marketing allotments are set by USDA according to statutory requirements. Marketing allotments and new payment-in-kind authority are designed to help the USDA meet the no-cost-requirements to the federal government by avoiding the forfeiture of sugar put under loan. Other parts of the new program can include a storage loan program for sugar processors, and reduced (by 1%) the USDA interest rate charged on sugar loans.[1]
The U.S. Sugar program has led to two main outcomes: Higher sugar prices and higher profits for farmers. According toUSDA data, in FY2025, sugar prices in the United States were 36.90¢/pound. The world price was 18.58¢/pound.[2] Multiple analyses by trade experts have attributed higher prices to the Sugar Program.[3][4][5][6][7][8] The impact of this, according to theAmerican Enterprise Institute, is that "US sugar program has been shown to cost consumers $2.4–$4 billion a year and induce losses of 17,000 to 20,000 jobs in the food processing and confectionery industries."[6] An October 2023 research review by theGovernment Accountability Office suggests that "the U.S. sugar program results in an increase in domestic sugar production and higher profits for farmers, totaling an estimated $1.4 billion to $2.7 billion in additional benefits annually." However, these benefits are offset by substantial costs to downstream industries. A 2006 analysis by theInternational Trade Administration concluded that "The existing literature on the economic effects of liberalization of U.S. sugar prices suggests that eliminating sugar quotas and tariff rate quotas and allowing sugar to enter the United States duty free would result in economic gains in the form of increased domestic food manufacturing production and U.S. exports, gains for consumers, taxpayer savings, and a net positive effect on U.S. employment."[9]
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This article incorporatespublic domain material fromJasper Womach.Report for Congress: Agriculture: A Glossary of Terms, Programs, and Laws, 2005 Edition(PDF).Congressional Research Service.Sugar as food commodity | |||||||||
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