No official word on sugar import quota increase
April 14, 2010
by Ron Sterk
WASHINGTON — Indications the U.S. Department of Agriculture may be near a decision to increase the 2009-10 sugar tariff rate quota (T.R.Q.) were less than sure despite U.S. Secretary of Agriculture Tom Vilsack’s comment on the matter reported by wire services on April 13.
Both Reuters and Dow Jones Newswires reported comments to reporters Mr. Vilsack made after speaking at a dairy meeting that the department would increase the 2009-10 import quota by 300,000 tons, although the timing of such an announcement was not known.
But the news services also reported a U.S.D.A. spokesperson indicated the decision had not yet been made on whether to increase imports let alone on an amount or the timing.
Trade sources told Milling & Baking News on April 14 there were indications the U.S.D.A. might not increase the quota based on its sugar data, which reflected reduced demand from last year. Many in the industry, though, said they believed sugar demand was up rather than down.
U.S. sugar users have petitioned the government to increase sugar import quotas by about 1 million tons, consisting of half raw and half refined sugar, due to tight supplies and high prices.
Domestic sellers have said adequate supply was available and claimed buyers’ main issue was with price levels.
U.S. bulk refined sugar prices for the current year recently dropped to 49c a lb f.o.b., with some trades reported around 45c, from highs of 53@55c in late January through mid-March.
Portions of the T.R.Q. were reallocated in late March to countries that indicated they had sugar to ship from countries that did not have supply, but the total T.R.Q. level was not changed at that time.
The U.S.D.A. has consistently taken a cautious approach to any change in import quotas.