Small Businesses Souring on Sugar Policy

The Wall Street Journal
By: Angus Loten

Federal limits on the supply of imported sugar in the U.S. market are boosting prices for bakeries, candy makers and other small businesses, according to the president of the Sweetener Users Association, a beltway lobby group.

Speaking at an annual meeting of sugar trade groups on Monday in Stowe, Vt., Randy Green said the limits are forcing smaller firms to buy sugar in lower volumes and at higher prices.

The limits, set out in the Farm Bill, seek to protect U.S. sugar producers by reducing lower-cost imports from 40 sugar-producing countries. As a result of a tighter supply, U.S. domestic sugar prices tend to be several cents higher per pound than world prices, raising costs for businesses that make bulk purchases.

Unlike larger manufacturers, smaller businesses often lack the resources to hedge against rising sugar costs, Green said.

The National Confectioners Association, which opposes the policy, estimates that more than 14,000 confectionery jobs and 75,000 food manufacturing jobs have been lost over the past decade as businesses move offshore for cheaper sugar.

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