The two major sides of the “single” sweetener market in the North American Free Trade Agreement region became apparent March 28 when the American Sugar Coalition filed an antidumping and countervailing duty petition with the U.S. Department of Commerce and the U.S. International Trade Commission against the Mexican sugar cane industry.

The 155-page petition charged the Mexican sugar industry with dumping subsidized sugar on the U.S. market that may cost U.S. sugar producers about $1 billion in the 2013-14 marketing year, which ends Sept. 30.

In response to the petition, the D.O.C. said April 18 it was initiating an antidumping and countervailing duty investigation into U.S. imports of sugar from Mexico. The I.T.C. is scheduled to announce by May 12 its determination of whether the domestic sugar industry suffered material injury from the imports. The D.O.C. is set to announce preliminary determinations on other aspects of the case June 23 and Sept. 4.

U.S. sugar prices had been trading in a fairly steady range from January through March, with bulk refined beet sugar at 26c to 27½c a lb f.o.b. Midwest and domestic cane sugar at 27c to 32c a lb f.o.b., according to Milling & Baking News. The prices were up about 1c a lb from last summer’s 5½-year lows. After the petition was filed, prices shot up 4c to 5c a lb, or 15% or more, and have held at 30c to 32c a lb for beet and 33c to 35c a lb for cane since mid-April.

While an argument may be made for both sides, the sugar producers who filed the petition are seemingly on their own, drawing fire from the U.S. Department of Agriculture, the Mexican government and sugar industry, U.S. corn refiners and understandably U.S. sugar users.

U.S. Secretary of Agriculture Tom Vilsack called the filing “ill timed.”

Mexico’s agriculture secretariat said the petition was “contrary to the spirit of cooperation that has marked the relationship between the two countries in the sweetener industry, and may seriously disrupt the delicate balance that exists in the trade of products,” which most took as a threat of retaliation against U.S. exports of high-fructose corn syrup to Mexico. (Mexico has yet to take any official actions.)

U.S. corn refiners said the petition was “unwarranted and unnecessary,” and that “exports of HFCS to Mexico, as well as … HFCS production in Mexico, could be imperiled by this case.”

U.S. sugar users said the petition was “a diversionary tactic to shift blame for sugar market distortion from the failed U.S. sugar program to Mexico.”

Sugar producers, on the other hand, were looking at least in part at the surge in U.S. imports of Mexican sugar during the first half (October-March) of the 2013-14 marketing year. Record high imports of 1,043,973 tonnes in the period equaled 66% of the projected total for the full year and were up 68% from the same six months of 2012-13, when imports for the full year were a record high 1,927,000 tonnes, which generally were credited for the collapse in U.S. sugar prices last summer.

While the U.S.D.A., Mexico and others cited Mexico’s reported commitments to export about 800,000 tonnes of its sugar outside the NAFTA region this year, some U.S. producers doubted the commitments would be fulfilled based on low world sugar prices, the strong export pace to the United States through March and the record high shipments in 2012-13.

While rhetoric and finger pointing may be at an all-time high in the sweetener industry, a few things are clear, although not necessarily easily fixed, and both sides have some legitimate arguments.

First, NAFTA, of which the sweetener provisions went into effect Jan. 1, 2008, was poorly written as far as sweetener trade is concerned because it has no parameters for U.S. imports of sugar from Mexico (and no parameters of U.S. HFCS exports to Mexico), which means both products may be shipped in any quantity users are willing to buy without regard to domestic producers. Most doubt NAFTA will be reopened to “fix” the sweetener issue.

Second, the U.S. sugar program, which was the only major program to survive the 2013 farm bill unchanged from the previous bill, needs revision, both on the price support side (the U.S.D.A. last year spent about $259 million on various forms of support) and on the production side in which U.S. sugar producers are restricted to 85% of projected domestic sugar deliveries (Mexico has no such restrictions and may produce any amount and ship any amount under NAFTA to the United States). But opening the U.S. sugar market to imports, as most sugar users want, doesn’t seem workable either because U.S. producers then would be competing with sugar from the world market that is subsidized in most major producing countries. It’s also unlikely the program will be addressed before the next farm bill.

Finally, as one government source noted, the U.S. sugar industry “got what it wanted,” referring to higher prices and a closer look at sugar imports from Mexico.

Many in the trade see the best possible outcome as one where the United States and Mexico agree to new parameters of sugar and corn sweetener trade, which may include some restrictions on the highly political Mexican sugar industry, that will allow the NAFTA region to act as a single market but without the wild price and supply swings that have been the rule more years than not since NAFTA began.

U.S. sugar prices, meanwhile, may move higher if the case advances and the U.S. government in some way acts to restrict imports of sugar from Mexico, which would further tighten sugar supplies in the United States. Of course prices may drop if the I.T.C. decides the U.S. sugar industry did not suffer material injury due to the imports. Either way, there will be plenty of rhetoric.