Sugar on the table again

Sugar got front-page notice from the Wall Street Journal today. The article focused on a letter sent to the Secretary of Agriculture to increase the amount of sugar that can be imported without tariffs.  Prominent food firms as well as several nonprofit groups, including CEI, signed the letter.

Currently, U.S. sugar users are facing steep prices and a shortage of sugar.  Under  the U.S. sugar program – a system of price supports and import restrictions — there are quotas on the import of tariff-free sugar.  The USDA and the U.S. Trade Representative administer the import quotas for sugar, which must be consistent with the U.S. commitments to the World Trade Organization. That quota amount is allocated to 41 countries, which means that the sugar can enter the U.S. duty-free or with a low tariff.  Import amounts above that face a steep tariff, unless the USDA determines that the domestic supply can’t meet the demand and increases the quota amount.

That’s what the letter is asking:

Without a quota increase, consumers will pay higher prices, food manufacturing jobs will be at risk and trading patterns will be distorted. Please act now in the interest of all Americans.

According to earlier studies by the General Accountability Office and the OECD, the cost of U.S. sugar policies to American consumers ranges from $1.5 billion to $1.8 billion.  See here and here for CEI publications on the sugar issue.