The U.S. Department of Agriculture announced last Friday the sugar tariff rate quota (TRQ) levels and overall allotment quantities (OAQ) for fiscal year 2010. Although the initial TRQ for raw sugar remains at the minimum level, as required by the 2008 Farm Bill, USDA expects to make adjustments during the year to ensure an adequate supply for domestic manufacturers.
The TRQ establishes the amounts of raw, refined and specialty sugars that may be imported for domestic use, which includes the manufacturing of flavored milk and ice cream. The OAQ determines the amount of sugar beet and sugar cane that domestic producers are allowed to market. Currently, the stocks-to-use ratio for sugar is at its lowest point in several decades, and IDFA has been a vocal proponent of higher TRQs.
The initial 2010 TRQ level for raw sugar remains at 1,231,497 short tons raw value (STRV), the minimum level allowed by the World Trade Organization. Refined and specialty sugar TRQs received a moderate increase of 75,000 STRVs to accommodate high demand for specialty sugars in organic food processing. The OAQ has been set at 9,235,250 STRVs for the coming fiscal year.
USDA has authority through the 2008 Farm Bill to increase sugar TRQs if adequate supplies are not available at reasonable prices. In its announcement, USDA noted that an expected cane sugar shortfall will require "reassignments to imports" later this year.
"We're encouraged that USDA recognizes the tight domestic supplies that our manufacturers are facing," said Clay Hough, IDFA senior group vice president. "Although the new OAQ still falls short of what American processors need, we look forward to the allowance of more imports to come."
In past months, IDFA consistently worked with the Sweetener Users Association to advocate for increasing the sugar TRQ, specifically for high-quality refined sugar used in dairy manufacturing. In addition, IDFA cosigned a letter addressed to U.S. Agricultural Secretary Tom Vilsack requesting a TRQ increase for FY2010.
IDFA will continue to monitor USDA action and update members. For more information, contact Katie Sparrow, IDFA manager of international affairs, at (202) 220-2507 or email@example.com.