U.S. Court Strikes Down Trump’s First Trade Deal, a U.S.-Mexico Sugar Pact

October 23rd, 2019


Category: Sugar, Trade

Sugar TRQ

(Financial Post) – A judge with the U.S. Court of International Trade has struck down the Trump administration’s 2017 revisions to a sugar trade pact with Mexico that limited imports of refined sugar into the United States, ruling that the changes were “unlawful.”

In a court document dated Oct. 18, Judge Leo Gordon ordered the U.S. Commerce Department’s 2017 amendments to a trade deal to be immediately vacated.

The decision, which will revert sugar trade terms to a previous, 2014 agreement, marks a blow to the Trump administration by overturning its very first trade agreement.

U.S. Commerce Secretary Wilbur Ross had renegotiated the sugar trade terms https://www.reuters.com/article/us-usa-trade-mexico-delay-idUSKBN18W2K4 in June 2017 to reduce the amount of refined sugar imports from Mexico while increasing raw sugar imports and setting minimum prices.

The deal suspended threatened anti-dumping and anti-subsidy tariffs https://af.reuters.com/article/idAFL1N1J31PA on Mexican sugar.

It was aimed at helping sugar cane and beet farmers, as well as U.S. sugar refiners such as ASR Group, the maker of Domino Sugar owned by the politically well connected Fanjul family of Florida.

President Donald Trump had praised the reworked agreement on Twitter in June 2017 as “a very good one for both Mexico and the U.S.”

But other U.S. sugar companies said the deal had curtailed their supplies.

One of these firms was CSC Sugar LLC, which sued to halt the deal before the Court of International Trade, a New York-based federal court that reviews challenges to trade decisions by the Commerce Department and U.S. International Trade Commission.

CSC alleged that the deal allowed competitors to use the trade agreement to deny it access to cheaper Mexican sugar imports.

A Commerce Department spokesman said in a statement that the agency was reviewing the court’s rulings.

“The Department intends to take all actions required by law to implement the court decisions,” the spokesman said.

Mexico’s Economy Ministry also said it was monitoring the new development, adding that it was an internal matter for the United States.” “It is clear to us that the producers who are parties (to the agreement) are satisfied with the Agreement. We will follow up promptly on how this question is resolved,” a ministry representative said.

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