IDFA has learned that the U.S. and Mexican governments jointly issued a letter rejecting proposals submitted last fall by sugar producers to regulate cross-border sweetener trade. Instead, U.S. officials said Mexico plans to improve trade between the countries by requiring sugar producers to report more reliable and timely information about supply and demand.
Following full implementation of the North American Free Trade Agreement (NAFTA) in 2008, the United States and Mexico now share a common sugar market. In the proposals, the growers had asked each country to consult the other before importing from third countries and to abolish the refined sugar re-export program. The letter affirms that each country will make its own import decisions and there will be no changes to the re-export programs, at least for now, the officials said.
"We applaud the Obama administration for holding firm on this important trade issue," said Clay Hough, IDFA senior group vice president. "We know that the growers have pushed hard at every turn to undermine the NAFTA agreement."
Sugar trade is critical to IDFA members that use refined sugar in dairy products like ice cream and flavored milk. With current U.S. stocks of refined sugar at historically low levels, IDFA believes the proposals would have further tightened sweetener supplies and caused job losses on both sides of the border.
The proposals marked the third time in two years that the sugar lobby has attempted to regulate the cross-border sweetener trade with Mexico. The first attempt to include sweetener trade restrictions in the 2008 Farm Bill was blocked by efforts of a coalition, which included IDFA. Sugar producers then sought government approval of an Export Trade Certificate of Review that would have allowed them to manipulate the amount of sugar exported from the United States to Mexico, but they later withdrew the request.
After the proposals began to circulate last fall, IDFA and other food industry organizations sent a joint letter to Secretary of Agriculture Tom Vilsack, asking him to reject the producers' recommendations.
Read the July 2010 letter from U.S. and Mexican officials here.
For background information, read "Industry Groups Urge Vilsack to Voice Opposition to Sugar Proposals."