Life Savers takes business to Canada over sugar costs

The Chicago Tribune ^ | January 30, 2002 | Tim Jones

[Willie Green]

Up until about two months ago, I lived in "The Thumb" of Mighigan, surrounded by sugar beet farmers.
Planting / harvesting etc. is highly automated and mechanized.
Not much labor involved other than running/maintaining the equipment and trucks.
And even that doesn't pay all that well.

[gcruse]

Were it not for ridiculous price supports on sugar, Willie, these jobs would
not be lost.  You can't have it both ways.Sooner are later, protectionism eats its young.
Without an Iron Curtain to keep investment from going abroad,  capitalism happens.

[Willie Green]

Governments of all sugar-producing countries intervene in their production, consumption and/or trade of sugar, which makes sugar one of the most heavily subsidized and distorted markets in the world.

The so-called “world price” for sugar is essentially meaningless, reflecting a relatively small residual or “dump” market of highly subsidized sugar. Since 1985, this dump price has averaged only half the world average cost of producing sugar, and bears little, if any, relationship to actual global supply and demand conditions.

About 75 percent of the world’s sugar production is not “traded” on the open market. Approximately 125 million metric tons of sugar are produced annually, and most of this–about 75 percent–is sold profitably in the country where it is grown and processed or it is sold at a profit under special arrangements to other countries. This allows the remaining 25 percent to be dumped below cost of production on what is commonly called the “world sugar market."

‘World dump market’ poses a serious threat to American consumers and producers. This so-called world market is a dumping ground for foreign sugar sellers. It is the most price-volatile of all commodity markets. In the recent past, prices have ranged from more than 60 cents a pound in 1974, and more than 40 cents a pound in 1980, to less than 3 cents a pound in 1985. Consumers are gouged as prices rise; farmers are hurt as prices plummet, threatening stable U.S. supplies. U.S. sugar policy works to keep supplies stable and prices reasonable.

[d4now]

bump

[Toddsterpatriot]

‘World dump market’ poses a serious threat to American consumers and producers.

I understand cheap sugar being a threat to producers, but how is it a threat to consumers?

[strela]

I understand cheap sugar being a threat to producers, but how is it a threat to consumers?

It makes your teeth fall out? That's the only downside I see.

[Toddsterpatriot]

Yes, we must immediately ban sugar. And cigarettes. And alcohol.

[Willie Green]

I understand cheap sugar being a threat to producers, but how is it a threat to consumers?

U.S. Agricultural policy of price supports for staple crops assures abundant supply and price stability for consumers.

Without such a program, there would be much greater price fluctuation along with the risk of shortages.

[strela]

Naaah. Cigs and booze don't make your teeth fall out - they cause statistics.

[Toddsterpatriot]

Without such a program, there would be much greater price fluctuation along with the risk of shortages.

So, we're better off with prices which are several times the world market rate? This protects consumers how? The U.S. price is never below world price, always higher. Sugar isn't a vital commodity like chromium or tungsten.

[M. Thatcher]

Now the globaloney "free" traders want to jeopardize production of a staple of our food supply.

Do you not read what you post? This is the 100 percent inevitable consequence of what you and your ilk preach: PROTECTIONISM, sugar subsidies.

Try learning a few laws of economics.

[Willie Green]

So, we're better off with prices which are several times the world market rate? This protects consumers how? The U.S. price is never below world price, always higher.

Sugar Prices
European Union... 25.8¢ per pound
United States... 18.6¢ per pound
World "dump" price... 7.2¢ per pound
Source

As mentioned previously, the so-called "World" price is a misnomer since little sugar actually trades at this price.
It is best referred to as the "dump" price of excess sugar.

American farmers are cursed with the blessing of being the most efficient producers in the world. Their phenomenal capability, especially in years of favorable growing conditions, produces an abundance of food that drives market prices below the cost of production. Unfortunately, this overabundance would also put TOO MANY farmers out of business as the market tries to correct itself. Should unfavorable growing conditions occur the following season, the result would be severe shortages and skyrocketing prices. The higher prices would not attract new production until the next growing season. It is a true feast or famine cycle that US Agriculture Policy levels out.

Sugar isn't a vital commodity like chromium or tungsten.

Go to your cupboard/refrigerator and start reading the lists of ingredients on the food items you have. You'll learn what a basic, vital commodity sugar is.

[Willie Green]

What are you babbling about, Thatcher?

[headsonpikes]

Willie, you didn't read balrog's post, did you?

It is common knowledge that multi-millionaire sugar 'farmers' on the Gulf Coast have 'owned' this issue, and the politicos associated with it, for decades.

Maybe they're the same guys that financed Pat's campaign.

You're being used like a Kleenex by these self-serving 'patriotic sugar-farmers'.

[Willie Green]

Willie, you didn't read balrog's post, did you?
It is common knowledge that multi-millionaire sugar 'farmers' on the Gulf Coast have 'owned' this issue, and the politicos associated with it, for decades.

Most any government program is subject to some kind of abuse by frauds, tax attorneys and shifty accountants.

It is equally common for political demagogues to flaunt these bad apples in their fanatical attempt to smear an entire program.

Unless sourced links are provide to credible sources of facts and figures, I prefer ignoring vague, wild@$$ claims of "common" knowledge. I'm more concerned with the impact on the small sugar beet farmers who were my neighbors for over a decade. That, and the severe implications for our nation's food supply.

[balrog666]

Most any government program is subject to some kind of abuse by frauds, tax attorneys and shifty accountants.

True. But this is a federal government program that exists solely for the benefit of corrupt congressmen. It is run and administered solely by the rules established by corrupt congressmen for their political donors - a handful of sugar cane growers. The cane growers exist entirely because of protected lands, the "federal help" of subsidized water (that would otherwise go to the Everglades and South Florida [where's there's been a drought for the last twenty years don't you know]), and guaranteed price supports. They are further highly protected from state interference of almost every kind, especially with respect to water diversion from vanishing Lake Okeechobee. And they use and abuse migrant workers seasonally so only a very small number of real jobs are involved.

Oh, and if you really want to stay completely ignorant of the subject, stay away from the web sites that hold the federal EPA reports, the Florida State Department of Environmental Protection reports, or the Miami Herald or Orlando Sentinel reporting on the continuing South Florida water crisis.

Well. We haven't even touched on the higher price paid by consumers, the loss of some American competitive advantage in processed food production from having to pay higher prices for simple sugars or use much poorer substitutes, the rise of the federally-subsidized-corn-syrup-cartel (ADM in particular) that also supports (pays congresscritter scum for) low import quotas on imported sugar, the polluting runoff of sugar cane refinement, or the destruction of Central American sugar plantations and economies from corrupt American protectionism, etc.

[Toddsterpatriot]

As mentioned previously, the so-called "World" price is a misnomer since little sugar actually trades at this price. It is best referred to as the "dump" price of excess sugar.

I'm still not convinced. If little trades at the low world prices, then how will U.S. farmers be hurt?

I agree, U.S. farmers are very efficient. Still, if farmers can't make a profit, they should go out of business. I looked in my cupboard and realize how much sugar is used. I realize how much cheaper products could be if the prices of many of the ingredients weren't propped up by the government system of tariffs and quota's.

It's a shame that steel producers can't continue to pay their employees very high salaries and make a profit at the same time. Unfortunately, as with sugar, the larger number of consumers are hurt more than the small number of producers are helped. Competition is tough. If farmers can't switch to another crop, I'm sorry.

The American consumer shouldn't have to pay for the fact that Cuban sugar, or Mexican sugar is produced more cheaply. Read some economics. It's called comparative advantage. We produce many other products more cheaply and efficiently.

If you want to see what happens when politically connected producers can short cicuit the free market, just look at Argentina. Won't turn out as badly here, but the cost is more than the benefit. If you like inefficient, state run companies, look at China.

[Great Dane]

Unintended consequences always seem to come back and bite you, don't they.

[Willie Green]

We haven't even touched on the higher price paid by consumers, the loss of some American competitive advantage in processed food production from having to pay higher prices for simple sugars or use much poorer substitutes,

The 10¢ per pound price differential between domestic sugar and the world "dump" price translates to approximately ½¢ cost difference for a roll of LifeSavers (even less for a 12 oz can of Coke), so I know darn well I don't have to worry much about the savings being passed along to the consumer. The benefits will be reaped only by those who buy sugar by the ton.

Now the loss of jobs because the Corporate Taliban seeks to sneak Cuban sugar across our borders as an ingredient in finished products, that's an issue that needs to be addressed.

As for Florida cane growers, I really don't care as much as I do about the northern sugar beet growers. But I'm not very receptive to hypocritical "save-the-swamp" arguements which ignore the trashing of tropical rain forests for imported cane sugar.

[Jhoffa_]

Americans can't even get a decent Coca-Cola anymore because the high cost of sugar forces the use of corn syrup!

I used to mix soft drinks for a local co-packer. Not only won't you get a coke, you won't get any soft drink I am aware of that's not sweetened with 42 or 55 HFCS.

It's just too expensive to keep around.