The US government is considering boosting raw sugar imports as refiners face a supply crunch due to a trade spat with Mexico and rising cane demand as food makers use less genetically modified ingredients, company and government officials said.
The US government is so worried about dwindling supplies that it is weighing options such as reallocating sugar to quota holders that have more sugar available, US Department of Agriculture Under Secretary Michael Scuse said at an industry conference in Miami on Monday.
It was the first time the USDA has publicly expressed concern that the non-GMO trend could contribute to supply issues.
"We have a responsibility to maintain adequate raw supplies," Scuse said, noting the agency would proceed cautiously.
It is not unusual for the government to adjust the tariff rate quota, or TRQ, which allows sugar to be imported from such countries as top producer Brazil and Australia.
But the fact the USDA is considering such steps underscores deepening concerns about the long-term impact of two major industry issues: the US trade pact with Mexico that limits raw imports, and the shift by food manufacturers away from GMO ingredients that is threatening beet sugar farmers.
More than half of US output comes from beet sugar, which is mostly produced from genetically modified seeds.
The trend away from GMO foods makes managing one of the world's top sugar markets more difficult, Scuse said at the International Sweetener Colloquium.
"There are companies that are wanting to go to non-GMO sugar," Scuse said. "It is going to cause a problem going forward."
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