By Chris Clayton
DTN Ag Policy Editor

OMAHA (DTN) -- A push in the U.S. Senate to repeal current sugar policies failed again on Wednesday as senators moved ahead with votes on amendments.

Senators seeking to overhaul sugar policies argued in vain that food-processing and confectionary jobs are lost to Canada because of import restrictions and tariffs that protect a small number of domestic sugar growers. Sen. Jeanne Shaheen, D-N.H., the lead sponsor of the amendment, argued that sugar was the only commodity in the farm bill that wasn't seeing reforms.

"Sugar remains the most tightly controlled commodity market in this country," Shaheen said.

Nonetheless, Shaheen and other senators pushing for reforms to the sugar programs saw their arguments fail in a 45-54 vote late Wednesday afternoon.

The vote on the sugar program was the subject of intense lobbying, with sugar-growing groups even cautioning that reforms to the sugar program could one day lead to heavy reliance on imported sugar. The American Sugar Alliance sent senators replicas of 1940s sugar rationing coupons to highlight possible risks of one day returning to rationing.

Shaheen's amendment would have eliminated some provisions of the 2008 farm bill. It also would have loosened import tariffs if the sugar stocks-to-use ratio fell below 15%. That was another major cause of concern for senators from sugar-growing states.

Sen. Toomey, R-Pa., a co-sponsor of the amendment, said the U.S. has "an extensive and complicated system" to create artificially high prices. "We subsidize a handful of wealthy sugar growers at the expense of everybody in America because I can't think of any consumer who doesn't consume sugar," Toomey said.

Toomey also criticized the sugar feedstock program allowing USDA to buy excess sugar on the market, which is sold at a loss to be converted to potential biofuels. Yet, that program hasn't even been implemented by USDA. The proposed rule for the program was sent to the White House Office of Management and Budget in early April.

Shaheen said U.S. consumers have paid as much as $14 billion in higher food costs over the last four years due to the import restrictions. Yet, her amendment was projected to save taxpayers just $82 million over 10 years, reflecting the low cost of sugar policies to taxpayers.

Toomey argued for every job in the sugar industry that is protected, there are three jobs lost in the sugar-processing industry. Some candy companies have moved to Canada, he said.

"They can make candy much cheaper," Toomey said.

Senators in the Red River valley answered the challenge to defend their sugar growers. Countering Shaheen's figures, Sen. Heidi Heitkamp, D-N.D., said rolling back the current sugar program would threaten 142,000 jobs tied to the industry. The amendment also would have allowed countries to trade U.S. import quotas on the international market. Heitkamp said that would risk fraud and abuse. "I think that's a formula for interjecting a factor that has never been used before in the sugar bill," she said.

Heitkamp also cautioned, "When you single out one commodity, you threaten the overall effectiveness of the farm bill."

Heitkamp's Republican counterpart from North Dakota, Sen. John Hoeven, also noted that sugar prices are currently low compared to the international market. Sugar prices have collapsed lately, reaching levels comparable to 1985 levels. "So because of the sugar program we have, American consumers benefit," Hoeven said.

Producers in the U.S. are also precluded from selling sugar into the European Union because of tariffs and restrictions, Hoeven said.

In other amendments, senators also beat back an attempt to convert the Supplemental Nutrition Assistance Program into a block grant to states. That amendment, offered by Sen. James Inhofe, R-Okla., failed 36-60 earlier in the date.

Debate and votes on amendments will continue into Thursday. The Senate isn't expected to have a final vote on the farm bill until after lawmakers come back from their Memorial Day break.

Chris Clayton can be reached at chris.clayton@telventdtn.com

(AG)

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