Commerce Could Turn Sour on Sugar Pacts

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By Rossella Brevetti

Dec. 2 — The Commerce Department is reviewing agreements with Mexican sugar exporters and Mexico on sugar trade to determine if they are in the public interest and whether effective monitoring is practicable, the Commerce Department said in notices issued Dec. 2.

Commerce said there was “some indication” that the agreements might not be working as intended but added that it didn't have sufficient information yet to make that judgment.

If the current agreements are scrapped, imports from Mexico could be hit with duties. The agreements suspended dumping and subsidy investigations on Mexican sugar imports, following findings that Mexican sugar had been sold below market prices in the U.S. market in 2013 and that Mexican sugar producers had been subsidized.

Imperial Sugar Co., AmCane Sugar LLC and the American Sugar Alliance requested the reviews. “The American Sugar Alliance welcomes the Department of Commerce’s preliminary decisions in the administrative reviews of the agreements suspending the antidumping and countervailing duty investigations of sugar from Mexico. They confirm that both the antidumping and countervailing duty agreements are not working,” American Sugar Alliance spokesman Philip Hayes told Bloomberg BNA in an e-mail.

Findings Expected Soon

Absent issuance of revised suspension agreements, Commerce said it plans to issue findings “as soon as practicable.” Commerce also said it would issue final results of its review within 120 days after publishing the preliminary results in the Federal Register.

Mexican sugar exporters, including Central Motzorongo S.A. de C.V. and Fideicomiso Ingenio San Cristobal, agreed to quotas and floor prices under the suspension pacts to settle the cases.

Consumer backlash against genetically modified organisms has dampened demand for beet sugar, which is grown from GMO seeds. At the same time, demand has risen for sweetener from cane and sugar refiners have complained about shortages.

Interested parties will have the opportunity to submit case and rebuttal briefs after Commerce issues its findings. Commerce did not immediately respond to a request for additional information.

To contact the reporter on this story: Rossella Brevetti in Washington at rbrevetti@bna.com

To contact the editor responsible for this story: Jerome Ashton at jashton@bna.com

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