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U.S. Senate approves Farm Bill, sugar policy maintained for five years

Ramagos cane field - White Castle, La.

Lafayette, La. – Several hundred of Louisiana’s sugarcane farmers and millers were listening to national agricultural journalist Jim Wiesemeyer’s talk about the sugar industry at the 91st annual meeting of the American Sugar Cane League at Hilton Lafayette when they got word that the United States Senate approved a new five-year farm bill. The audience burst into a spontaneous round of applause.

Wiesemeyer praised the Louisiana industry for their role in lobbying Congress for passage of the measure.

"You work Congress each year as if there were a farm bill being considered that year,” Wiesemeyer said. "You’re politically engaged and you’re a solid group both in Washington and on the grass roots level.”

The Senate voted 68-32 on the farm bill that will preserve existing sugar policy as is, said Jim Simon, manager of the ASCL.

"Louisiana just completed its 219th annual sugarcane harvest,” Simon said. "Our sugar industry provides an economic impact to our state of almost $3 billion. At little or no cost to taxpayers, the sugar provisions in the 2014 Farm Bill give our industry a fighting chance to survive against subsidized foreign producers while providing the kind of stability that bankers need to be able to continue to underwrite our State’s 483 family farming operations and 11 raw sugar factories and 2 refineries. Sugarcane supports 16,000 Louisiana jobs and passage of the Farm Bill will certainly help to sustain this all important Louisiana industry.”

Simon said the farm bill’s sugar policy does not provide any payment to sugar farmers but instead relies on an inventory management approach to maintain prices to keep American sugar farmers in business.

The policy works through the United States Department of Agriculture which loans money to sugar mills so farmers can get paid for their crops. The raw sugar that the mill produces is the collateral. If sugar prices fall to disastrously low levels the mill can forfeit the sugar to the USDA in payment of the loan.

2013 was the first time since 2002 that sugar producers were forced to forfeit their sugar.

Simon said the forfeitures were not caused by overproduction in the domestic sugar market but by the North American Free Trade Agreement that allows Mexico unlimited access to the U.S. market.

"Mexico can ship us as much sugar as they want because of NAFTA,” Simon said. "The Mexican government owns one-fifth of the Mexican sugar industry so they are much more inclined to prop up inefficient sugar mills that should fail. It’s tough on Louisiana producers who don’t have that kind of safety net. In the United States, if you’re inefficient, you go out of business.”

Simon said senators Mary Landrieu and David Vitter voted for passage of the farm bill.

"We’re grateful to our senators for their support,” Simon said. "But I am especially proud of our farmers who take the time out of their schedules to fly in to Washington D.C. to meet the senators and congressional members and staffers who develop our farm policies. Our Louisiana farmers who visit Washington are the real heroes in this farm bill approval.”


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