USDA lobbies sugar industry to support Pacific trade deal

By Chris Prentice
BERNALILLO, N.M., Aug 5 (Reuters) - A U.S. Department of
Agriculture official on Wednesday used a sugar industry
gathering to press the importance of the Trans-Pacific trade
pact that U.S. sugar farmers worry could overwhelm the market
with excess supplies and hurt prices.
The agreement is critical for U.S. exports and agriculture
as a whole, said USDA Under Secretary Michael Scuse at a
conference in Bernalillo, N.M., attended by sugar farmers and
policymakers, an audience with little to gain from the
12-country agreement.
"If we don't do this, we will be left behind" on new export
markets, Scuse said.
He sought to garner support from the small but powerful
sugar lobby. The United States is a net importer of the
sweetener, leaving sugar as one of the country's only
agricultural sectors that does not view the landmark TPP deal as
a gateway to new markets and instead as a risk to market share.
"We are working to ensure sugar is included in TPP
negotiations," Scuse said, saying sugar cannot slow the progress
but that the U.S. government wants a deal that does not
"interfere" with the sweetener industry's federal support
program.
TPP talks stalled last week as disputes grew over products
like automobiles and dairy. Sugar has also been considered a
sticking point.
The U.S. sugar market is highly managed through a complex
system of price supports and import quotas that the government
doles out to countries like the Dominican Republic and
Australia.
Australia earlier this week rejected a U.S. government offer
for 152,00 tonnes.
A pending sugar trade deal with Mexico that establishes
reference prices and an imports quota has made granting
additional quota under TPP even more tricky.
Allowing more imports from Australia would reduce demand for
Mexican sugar and could ultimately threaten the U.S.-Mexico
deal, which gives Mexico all access to U.S. demand beyond
domestic production and already-established tariff-rate quotas.
That pact is considered integral to preventing a repeat of
2013, when North American supplies swelled and the USDA spent
more than $250 million scooping up excess inventories through
the typically no-cost sugar program.
Those soaring costs intensified criticism of sugar's federal
program from policymakers and users who say it inflates domestic
prices.