USDA Issues New Sweetener Outlook for U.S.-Mexico Market

(IDFA) –  The Economic Research Service within the U.S. Department of Agriculture recently published an updated outlook for the U.S.-Mexico sugar and sweetener market. The report summarizes the history of the U.S.-Mexico sugar trade through its integration in the North American Free Trade Agreement (NAFTA), the separate domestic sugar policies, the large crop harvests from 2012 to 2014 and the agreements to suspend investigations on sugar imports from Mexico – all of which affect the current sugar and sweetener market.

In December 2014, the U.S. Department of Commerce, the government of Mexico and producers and exporters accounting for substantially all imports of sugar from Mexico signed agreements suspending the anti-dumping investigation and the countervailing duty investigation on sugar from Mexico. The agreements also provided for more control over Mexican sugar exports to the United States.

Recently, due to tight raw cane sugar supplies, U.S. sugar cane refiners have called for a renegotiation of the suspension agreements. Officials from the Mexican government and Commerce have met several times in the past few months but have not come to an agreement yet.

Last month, the Sweetener Users Association, of which IDFA is a member, sent a letter to U.S. Secretary of Commerce Penny Pritzker detailing how the suspension agreements have distorted the sugar market. SUA urged Commerce to renegotiate the pacts to improve them.

The full ERS report can be found here.