After an impasse in negotiations, the U.S. Department of Commerce formally notified Mexico on Monday that it would resume collecting antidumping and countervailing duties on imports of Mexican sugar to the United States unless a resolution can be reached before June 5.  

The duties, which were first suspended in December 2014 pending a permanent agreement between the two countries, limit the amount of sugar Mexico can export to the United States while also establishing minimum prices on imports. This March, Secretary of Commerce Wilbur Ross and his Mexican counterpart engaged in renewed efforts to resolve the dispute over Mexican sugar exports to the U.S., but no agreement has been reached.

The formal notification said “despite everyone’s best efforts and numerous meetings, there remain outstanding issues between the two parties.” If the two sides fail to reach an agreement before the June 5 deadline, duties on imported Mexican sugar will return, with antidumping duties ranging from 40 percent to 42 percent and countervailing duties from six percent to 44 percent.

Until the U.S. sugar industry filed anti-dumping and countervailing duty cases in February 2014, there was free trade in sugar between the United States and Mexico since early 2008. Mexico has become an integral part of the North American sugar trade and is a critical supplier of sugar to the United States.

IDFA has argued against the suspension agreements and duties imposed on Mexican sugar imports, because they undermine free trade and the core principles of the North American Free Trade Agreement.

The Sugar Users Association, of which IDFA is a member, issued a statement today urging the administration to overhaul the agreements and encourage a more competitive marketplace.

“The agreements have distorted sugar markets through new constraints on supplies and higher sugar price floors than the ones Congress voted for in the last farm bill. They have also distorted the flow of raw and refined sugar from Mexico to the United States, leaving U.S. cane sugar refineries short of supplies, which means lack of supply for U.S. manufacturers,” SUA said in the statement.

“When it comes to the bigger picture, whether the agreements are revised or the antidumping duties take effect on June 5, America’s sugar policy is clearly a mess. To ensure that sugar works not just for the sugar lobby, but also for hardworking American manufacturers and consumers, Congress must enact meaningful reforms to the federal sugar program in the 2018 farm bill,” SUA concluded. 

Read “SUA Statement on U.S.-Mexico Sugar Negotiations.”

For more information, contact Beth Hughes, IDFA director of international affairs, at bhughes@idfa.org.