U.S. House Farm Bill Draft Supports Subsidizing Sugar for Ethanol Production
by Jeremy Elton Jacquot, Los Angeles on 07.11.07
The oft-delayed, much debated 2007 farm bill is finally set to start grinding forward again with the House Agriculture Committee scheduled to begin its markup July 17 and aiming to take the bill to the floor the week afterwards. As part of a newly announced 111-page update to the crop subsidies program, U.S. growers will have the opportunity to sell beet and cane sugar for use in creating ethanol. This is a landmark shift for the program, which had previously only treated sugar as a food source.
Support rates for sugar, which now stand at 18 cents per pound for cane and 22.9 cents per pound for beet sugar, would increase to 18.5 cents and 23.5 cents, respectively. To help make this happen, the Agriculture Department would set rigid limits on marketing allotments for "domestic human consumption" for the 2008-12 crop years. Not surprisingly, the American Sugar Alliance, the sugar grower trade group, has come out in favor of the proposal, stating that it would make the program "even stronger" with its "long overdue loan rate increase" and support for ethanol production.
According to the proposal, the USDA would intervene to buy any surplus sugar and sell it to ethanol producers if it helps keep the program's net operating cost in the black. These purchases would supposedly only be made when necessary through a competitive bidding process.
We've often argued that such crop subsidy programs are a bad idea: not only do they harm poor producers around the world by drastically lowering prices, they also typically benefit only the largest, richest farmers (for a full list of the beneficiaries, check out Mulch's Farm Subsidy Database). While it may have made economic sense for Brazil to encourage the use of sugar cane-based ethanol initially (they had large surpluses in the late 1970s and 80s), subsidizing its production in the U.S. is not an ideal strategy. Could we soon witness the rise of another King Cotton or King Corn?
Via ::Reuters: U.S. House draft allows sugar as ethanol feedstock (news website), ::MyDD: Farm Bill Subsidies: Who's the Biggest Winner of them All? (blog)
The should just drop the embargo on Sugar imports. especially from Cuba. It would be vastly cheaper for the taxpayer!
Sugar subsidies are bad for the environment. The farm bill needs to start supporting small farmers who want to raise plants and animals sustainably, not huge agribusinesses, that will wreck the land, and contribute to global warming with their emphasis on monoculture. Read Michael Pollan's "Omnivore's Dilemma" for more on the myriad environmental/economic/health woes caused by monoculture style farming.
AHHHHHH! If we're doing anything with sugar why don't we get more of it in our FOOD instead of stupid high fructose corn syrup (the devil incarnate). If we stopped the culture that allows it as a sweetener then they could shift that into production for ethanol. and what about the tobacco farmers? couldn't they be helped to shift into crops for ethanol?
Just this week the House Agriculture Committee released its Farm Bill outlining new changes to federal support for farmers. As the bill relates to sugar, it looks like consumers and workers might get less than a sweet deal.
For years our Sugar Program as it is known channels big subsidies to sugar growers to reduce their costs and let them grow more sugar. Yet that's not all Big Sugar gets. The sugar program also severely restricts the amount of foreign supplies of sugar that is allowed into the US market. These restrictions - a blend of very high border taxes and quotas - are designed to make sure that US consumers don't get the benefit of tasting sugar grown in other countries such as Brazil and Haiti.These trade restrictions on foreign supplies of sugar have actually been partly to blame for the elimination of 11,000 sugar refining and candy manufacturing jobs. These industries have had to close their doors to US operations and open shop overseas to take advantage of cheaper supplies of sugar abroad. Of course these jobs wouldn't be lost if Congress eliminated the combination of highly restrictive quotas and tariffs.
Instead of turning things around Congress has made this bad system worse. The recently released Farm Bill proposes to make it that much more difficult for US candy makers and consumers to get access to foreign supplies of sugar. In the end, it is workers and consumers that will pay for this kind of protection offered to such a wealthy few.
I just don't understand why we are making the system that is already inefficient and broken even more complicated.
If we are trying to reduce the price of ethonal for biofeul why give more money to a sugar oligarchs who already can't properly make regular sugar let alone increase production to cover ethonal?
Once again, subsidies in form of hidden taxes to the consumer make everyday consumer products unaffordable for working families.
I understand the plight of farmers but I am even more concerned about the welfare of the rest of the working poor in America.
I think for the very least, this bill should include an amendment allowing the import of sugar to make biofuel. This will keep the subsidy for sugar in tact but will not raise the price of food. The ammendment, which can be easily added will ensure that foreign sugar does not compete with US.