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Econwatch
August 13, 2009 12:07 PM

Food Firms Sound Alarm on Sugar Shortage

By
Daniel Carty
Topics
Sugar
(CBS)
It could get a lot easier to reduce the amount of sugar in your diet, if some of America's biggest food companies are to be believed.

Several giant food producers sent a letter to Agriculture Secretary Tom Vilsack warning that the U.S. might "virtually run out of sugar" of the country didn't reduce import restrictions on the increasingly expensive commodity, according to a Wall Street Journal report $ Thursday.

The firms – including Kraft Foods Inc., General Mills Inc., Hershey Co. and Mars Inc. – indicated that if they couldn't tap supply markets like Brazil, they'd run out of sugar to make candy bars, cookies, cereal and a host of other products.

Currently, the U.S. only allows unlimited imports from Mexico without tariffs in an effort to boost prices for U.S. sugar farmers. Tariff-free supplies from other sugar-exporting countries are limited by a quota.

If those restrictions aren't eased, the food companies said they'd be forced to hike prices and slash jobs.

Many economists, however, aren't buying the argument and doubt the intentions of the firms.

"We doubt if they will do anything because there is absolutely no shortage of sugar in this market. Every sweetener-user company that's looking for sugar can find it. We've got sugar sellers right now who've got sugar piled up waiting to sell," Jack Roney, chief economist for the American Sugar Alliance, told CBS News.

Roney said that the projections used by the companies assumes Mexico will cut its current level of supply to the U.S. to just one-tenth of what it was last year.

Add a Comment See all 27 Comments
by quapawsix August 17, 2009 10:47 PM EDT
Quit buying sugar or anything with sugar for a month and see if their tune changes
Reply to this comment
by ibsteve2u August 14, 2009 7:26 PM EDT
Matter of fact, all that we have to do to resume growth in America again is to roll EVERYTHING - minimum wage, wages, salaries, taxes, rental rates, house values, and consumer prices - back to where they were in 1979 before Republican tax cuts and Republican protection of oil company profits (and Republican efforts to block weaning ourselves from oil) started driving the American economy out of whack.
Reply to this comment
by mary-miami August 14, 2009 5:33 PM EDT
Surely Mexico is not our only sugar supplier...? We can even grow sugarcane in the United States...Florida for example.
Reply to this comment
by ibsteve2u August 14, 2009 7:21 PM EDT
If permit unlimited imports from Mexico, all that our sugar producers and refiners will have to do to compete with them is to reduce the pay of their workers to $16.27.

A day.
by xlib August 14, 2009 11:58 AM EDT
Uh OH, another CRISIS!!! Gotta love it. Yea, it is funny when the dems decided that the obese were the evil ones and causing rise in health care. No mention of tort reform in the bill, not one word.
Reply to this comment
by afmcalax August 14, 2009 8:54 AM EDT
Why should American consumers pay more for sugar and products made from sugar so a few, influential sugar beet farmers can maintain their wealthy lifestyles. Where are all you Republicans that want free markets and competition? If Latin and South American countries can grow sugar cheaper than they should be able to sell it here?

The high tariffs on imported sugar is a leftover from the World Wars when the U.S. needed to ensure a safe supply. That need has long since passed. Maybe if farmers in Latin and South America had a market for sugar in the U.S. they would not need to grow poppies.

This is another example of big business being cut a break and the American consumer picking up the price.
Reply to this comment
by xlib August 14, 2009 12:02 PM EDT
Oh so now you call on the Republicans to fix this and I love the class warfare comment. So, just who has the majority now, and, geez, for the past 3 years. Seems like this is something that has been going on for a long, long time and I question the timing of this new CRISIS de jour. Too convenient for the thug.
by afmcalax August 14, 2009 1:27 PM EDT
Duh to xlib ... where is the class warfare comment coming from? Trying to eliminate sugar quotas has gone on for decades but the few sugar beet farmers in the Southern states call in their favors to those bought off politicans and it gets defeated every year. Bush had 8 years, Clinton 8 years before him and nothing is ever done. I am just saying that from 2000 to 2006 Republicans had the majority in Congress and the Presidency, this was the time to let this quota die and they did not.

This is anti-consumer, whether it helps the candy makers, etc. is not the issue. The issue is that if Republicans truly believe in free market capitalism then this should have been resolved years ago. That a few rich growers can make the rest of America pay more for all products that contain sugar is not right.
by opleez August 14, 2009 8:23 AM EDT
Let's see...maybe they can take the sugar out of things that shouldn't include it like soups, frozen dinners, processed meats and other processed foods then they'd have plenty of sugar for their over sweetened candies and baked goods. A sugar shortage would be the blessing this country needs!
Reply to this comment
by creeper00 August 14, 2009 7:52 AM EDT
More fearmongering from those with a bit of power. Wouldn't it be nice if our politicians and big business quit trying to scare the sgut out of us every chance they get?
Reply to this comment
by barbaram99 August 14, 2009 3:27 AM EDT
I had a can of pop and and my friend wanted it. I looked to see how much sugar was in that can of grape soda. Over half of it. I did not buy any more, I saw on the news where they say there is a shortage of sugar, Can they made the thingg that call for sugar with less if there is trully a shortage. People eat too much sugar. I can eat a bowl of corn flakes with no sugar. People over salt their food. I don't as their is salt in the food. A candy bar. They are too costly. I 'member 5 cent candy bars Growing up there was penny candy. We had it every once in a while. A sugar scare. I don't know. We use too much.
Reply to this comment
by marfly August 13, 2009 11:31 PM EDT
sure there is a sugar shortage like there was a gas shortage and then suddenly the gas shorage disappeared - bs...............it sounds like blackmail - don't reduce the import tax then no sugar for the fat americans - why produce products that are so unhealthy? those companies don't give a darn about anyone but the bottomline....and one or more of those companies is probably the parent comPANY of CBS...
Reply to this comment
by davlar2 August 13, 2009 3:11 PM EDT
Sounds like a case of price manipulation, not unlike when speculators caused price of gasoline to run up past $5/gal. FTC should investigate.
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