U.S. runs low on sugar, get ready for high prices
Filed under: Food, Recession, Stimulate US, Buyer Beware
The United States is facing a major sugar shortage, according to the Wall Street Journal (subscription may be required). On Aug. 5, General Mills, Hershey Co, Mars Inc., and Kraft Foods alerted Thomas J. Vilsak, the secretary of the U.S. Department of Agriculture, of their combined forecast of low sugar supplies. These food companies warned that if the Agriculture Department does not allow them to import more tariff-free sugar, "our nation will virtually run out of sugar" and they will be forced to raise consumer prices and lay off workers.
This comes as a major eye opener, but there's more to this finding.
The WSJ states that the present trade quota places a limit to the number of tariff-free sugar that can be imported per year, with the exception of Mexico. This leaves major suppliers like Brazil out of the free trade mix. The fear looms that Brazil may not even have significant sugar supply for the U.S. because they are busy using large amounts of cane crop for ethanol use.
Another problem is the U.S. government; not a surprise. The U.S. artificially inflates domestic prices of sugar in order to support the incomes of farmers in the Midwest who are friendly with politicians who help them. Anything for a vote, right?
Economists state that sugar is part of the equation. Sugar is an active ingredient in almost all foods, and the impact of a price increase will be big. Food companies pay twice the world level for sugar because of government meddling.
Unless politicians in Washington decide to ease import quotas, the "U.S. will end the next fiscal year with less than 13 days worth of sugar on hand" according to the four food companies who band together to ring the alarm atop Capitol hill.
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Food Prices Around the World
Food companies warned that if the Agriculture Department does not allow them to import more tariff-free sugar, "our nation will virtually run out of sugar" and they will be forced to raise consumer prices and lay off workers. For more on food prices, browse through this gallery.



Reader Comments (Page 1 of 13)
8-14-2009 @ 10:49AM
lesa said...
maybe it is time to change the ingredients with sugar prices so high and diabetes and obesity on the rise. We need to look at what we eat. Change the ingredients and lower the cost of food.
Reply
8-14-2009 @ 1:07PM
Tim said...
Yes, but this is America. If someone wants to chance getting diabetes by eating 1500 candy bars a day let them, and let them be happy. It is their business if they want to eat unhealthy, and it is their right as an American.
8-14-2009 @ 3:32PM
chris said...
you both are right in my not so humble opinion. It should be more expensive though, and healthier foods less so. In some countries (like germany) the government subsidizes foods that aren't junk food. Tax things that aren't a necessity.... like marijuana... RATHER THAN MAKING IT ILLEGAL
8-14-2009 @ 3:38PM
jrd000000001 said...
yea, its not really the sugar thats causing the health concerns.... its the high fructose corn syrup......
8-14-2009 @ 7:25PM
John said...
We may be running low on sugar, but not sweeteners. The corn industry will keep providing corn syrup, an inferior products compared to cane sugar. They are not too serious about it or they would turn their attention to the potential in Cuba. Reinvigoration of that activity in Cuba would hasten their move toward free enterprise. That is not an acceptable alternative to several groups of people who don't care about Cuba's future.
8-14-2009 @ 7:33PM
Matt said...
wow, youre in a idiot.
lolercopterroflwatermelonberries.
8-15-2009 @ 12:53PM
Linda said...
This is my opinion, if the government would stop interferring with the production of sugar cane in the US we wouldn't need to import it. When I was a teen, my grandparents grew sugar cane . Why are we not still growing it here in the US? We need to, as a country, to stop these imports and improve our economy.
8-15-2009 @ 4:19PM
Tim said...
Yes, Tim that is fine, let everyone who wants eat all the sugary junk food they desire. Just tell them NOT to come complaining that they need health ("sick") care insurance from the ones who do take care of their health.
8-15-2009 @ 5:04PM
JohnP said...
Yes you are right, sugar does lead to health problems like obesity, diabetes, and now there are new findings that show sugar can cause an increase of inflaimation in the human body. It's time the US get off the sugar and oil addition, let us experience a lifestyle change for the better. Let the US now use the savings to do the same as Brazil and produce more ethanol and get off the sugar kick!
8-16-2009 @ 3:51AM
Shane MIrabella said...
We should look to the Lord. He is the maker of Heaven and Earth, who else better to ask than Him? Maybe we need to ask him for more wisdom in the situation. The Bible says, "You have not because you ask not." Im not saying He will drop a heaven load of sugar, of coarse not. But this nation was based upon the Word of God and yet we have strayed, and I'm pretty sure we suffer thus in many ways as this sugar problem. He loves us, so much so, He died for us. Lets consider Him for a change
8-16-2009 @ 8:22AM
Tired of Hearing it said...
Maybe you should worry about YOU and stay out of everyone else's business. I'm sick of people who think they "know what's best for ME". You should shut up and butt out.
8-16-2009 @ 8:39AM
Dudley Haas said...
If the US is running low on food stamps, it needs to print more of them out -- IMMEDIATELY!!! Chris Hughes needs a new stereo system, fax machine, didgital camera and computer. He should be able to get all of these with a few food stamps under Obama's new plan.
8-16-2009 @ 9:22AM
Shandon P Hudson said...
Maybe it time to replace those politicians that are "fixing" the prices with their buddies.......
8-16-2009 @ 10:21AM
joe said...
I a that agree that American companies are the root of obesity in this nation. In an attempt to create a product that consumers would want they have pushed the sugar issue coating products in a tasty mash of diabetic prone goo. Lets tell these companies that our children do not need the sugar and begin to create a healthier diet. After a few months of not having sugar in our diet we will forget that it was ever there.
8-16-2009 @ 5:08PM
Marge said...
Why do you think the world's largest cereal manufacturer recently built a new plant just outside the border in Mexico?
8-14-2009 @ 10:56AM
bsfurg said...
for god sake.. why dont the farmers in american just plant more sugar beets and make our own sugar... there are millions of land in american that is not being used... we have a sugar plant not far from where is live... and they wanted to close it.. well use some commen sence and keep the dam thing opened and use it for the sugar the farmers of american .. plant more sugar beets.. how much brain power does that take ...
Reply
8-16-2009 @ 12:04PM
GrouchOH said...
SUGARBEETS! You are absolutely on target, bsfurg!
Pioneer Sugar was processing sugarbeets into pure sugar near Saginaw, Michigan decades ago. That processing plant provided cash flow for entire communities of farmers in central Michigan. This root crop, as compared to corn, is not as vulnerable to severe weather, and grows in climates where sugar cane cannot survive.
We need more sugarbeet processing facilities, operated by farmers’ community-based Co-Op’s, throughout the Midwest, to reduce our dependence on imported sugar and energy. Sugarbeets should produce more ethanol per acre, at a lower cost, than corn.
This is obvious to people living in the heartland, but do not expect Agribusiness to make this happen. Those corporations are run by the same type of arrogant, ignorant, unethical, incompetent frat boys who mismanaged our banking system to the brink of depression, then got bail-outs and bonuses from “We The People.”
8-14-2009 @ 11:03AM
Ibe said...
I agree with bsfurg, we need to protect our food supply, and be more self dependent. Higher sugar that leads to higher food prices will lead to even less retail business. We have allowed our Congress and White House (both parties) over the years to give away more and more of basic needs to countries "over there". Vote everyone of those inside the belt loop out and let's try and start over again.
Reply
8-15-2009 @ 11:25AM
TheFeyNan said...
And I agree with lbe....we pay farmers not to grow crops, so the large corporate farms can make all the money....plus we as a country just need to stand on our on two feet again...it is what we are all wanting....I think there needs to be a limit to congressional terms...it is the only answer....new blood every 8 years in Washington, just like the President...and one year severance pay...not for life....how can we as a people get things like this done?????
8-15-2009 @ 10:46PM
Fake sugar headaches MawMaw said...
I agree for the most part. Some people want to take the whole isolation thing too far though. Even down to the music you want to listen to. "Bar the door and keep everything out" makes you introverted and crazy. You go one of two ways when that happens. Don't you go calling me something esoteric like a rabbit either! I'm not into hurting others. Want to call me anything esoteric like that then call me a fox but I'm really a human being. I respect the rights of others. Blue, natural, romantic and dandy. I like to work, play and eat a >little< candy.