There is nothing sweet in the sugar war that is unfolding between Mexico and the United States.
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The U.S. industry, sometimes called Big Sugar, simmers over soaring competition from Mexico and argues that a doubling of Mexican exports triggered a collapse in the market price of sugar.
A reluctant Obama administration has opened a formal investigation into those exports that could result in new import duties on Mexican sugar — and ignite a broader trade dispute over sweeteners that might affect other U.S. industries.
A spokesman for the American Sugar Alliance, Phillip Hayes, said the sugar industry faces losses of up to $1 billion this year because of what it alleges is dumping — selling at prices lower than what it costs to produce — by Mexican sugar producers.
“We are far more efficient than Mexico’s sugar industry, yet we are losing market share because of Mexico’s predatory trade practices,” Hayes said.
The dispute ricochets to the far corners of both countries, involving hundreds of thousands of jobs and affecting sugar cane fields in Florida, Texas, Louisiana and Hawaii, and sugar beet farms in the Red River Valley of Minnesota and North Dakota, along with California, Idaho and the Pacific Northwest.
“This is a very big battle,” said John W. Bode, president of the Corn Refiners Association, a trade group with offices in Washington, D.C. “The political influence of the U.S. sugar industry is legendary. … They may be only 4% of U.S. agriculture but when you look at political contributions, they account for a third.”
The U.S. International Trade Commission is due to vote May 9 on whether Mexican imports harm the U.S. sugar industry.
Mexico also has much at stake. Its sugar industry employs 500,000 people.