A representative of America’s sugar farmers and processors expressed pleasure, on Friday, at the import quota level set by U.S. Department of Agriculture for 2000-2001 fiscal year.

USDA today set the import quota level at 1,500,227 short tons.

Luther Markwart, chairman of the American Sugar Alliance, said the domestic sugar farmers and processors had urged USDA to set the import quota above 1.5 million short tons so that traditional agricultural non-recourse loans will be available to the industry. Under the 1996 Farm Bill, an import quota of 1.5 million short tons or less would deny sugar processors access to anything other than recourse loans.

With non-recourse loans — which all other U.S. crops operating under farm programs are guaranteed — a loan can be repaid by forfeiting the collateral (sugar in this case) to the government’s Commodity Credit Corporation, which makes the loans.

A recourse loan, on the other hand, must be repaid with dollars, no matter how low the commodity’s price might drop, setting up situations where a farmer could have his tractor or other farm equipment seized to satisfy the loan.

“We applaud this timely action by the Department of Agriculture,” Markwart said, “especially in this time of extremely economically distressed sugar farmers.” Wholesale refined sugar prices have dropped by more than a third since the beginning of the 1996 Farm Bill. Some sugarbeet and sugarcane processing mills have closed during this period of economic hardship and thousands of tons of sugar have been forfeited to the government, with more forfeitures likely by the end of this month.

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The American Sugar Alliance is a national coalition of growers, processors and refiners of sugarbeets, sugarcane, and corn for sweetener. For more information about U.S. sugar policy, visit www.sugaralliance.org.

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