Washington, D.C. – A new bi-level U.S.-Mexico trade pact eliminating tariffs on imports of sugar from Mexico, but also establishes minimum prices and caps on the amount of different types of sugar that can be exported from the U.S., has drawn fire from a major U.S.-based industry group.
“With the stroke of a pen, these agreements dismantle the unrestricted free trade of sugar between the United States and Mexico since 2008 and undermine the core principles of the North American Free Trade Agreement (NAFTA),” said the Sweetener Users Association (SUA).
The Washington, D.C.-headquartered SUA is the largest sugar-related industry group in the country representing such sugar-using giants as Mars Inc. and the Hershey Company.
The deal, says the group, “has increased the importance of broadening access to the domestic market through other trade agreements and the need for greater reform of a government sugar support program.”
The agreement “will limit supplies of sugar from Mexico, driving up costs for food companies and consumers, and make it necessary to boost access to the U.S. sugar market to Australia and Canada through the Trans-Pacific Partnership Agreement,” the group said, adding they “move the U.S. sugar program in the wrong direction.”
In essence, the new deal curbs the access to the U.S. sugar market Mexico obtained through NAFTA, which was finalized late last week after changes to a pact that was traded to end a U.S. government investigation into the dumping of cheap, subsidized sugar from Mexico.
The signed deal raises the price floor for sugar and lowers the proportion of refined sugar that the country can export to the United States.
For several years, the SUA has pushed for an overhaul of the controversial U.S. sugar program that it and other critics say bloat U.S. prices amid a complicated network of import restrictions and price supports.