The Trump administration has missed a deadline for reallocating unfilled tariff-rate quotas (TRQs) for sugar imports, rankling importers that rely on the quotas for affordable product.
The U.S. allows a set volume of raw sugar to enter the U.S. market at a reduced tariff rate every year. But the methodology used to calculate each country’s quota uses 40-year-old market data, and some countries no longer produce enough sugar to fill their quotas, according to a 2023 Government Accountability Office report.
Accordingly, the administration reallocates unused quotas. In recent years importers have complained that delays in reallocation leave producing countries scrambling to increase production on short notice, and force importers to rely on high tariff, out-of-quota imports.
Lawmakers sought to maximize use of the TRQ in the One Big Beautiful Bill Act (OBBBA) by encouraging the Agriculture Department and the Office of the U.S. Trade Representative to reallocate the unfilled quotas before March 1 each year. But a month later, quota reallocations have still not materialized for 2026.
“USDA is still reviewing a variety of factors related to the economic conditions of the domestic sugar industry, the supply of sugar in the U.S. market, and other related factors,” a USDA spokesperson said in an email last week. “We will continue to communicate with all stakeholders as appropriate to best understand the impacts of a reallocation decision.”
After this story was published, a USDA spokesperson stressed to Agri-Pulse in a follow-up email that “conditions in farm country are difficult" and that "producers have been sounding the alarm for months."
"Why would the Trump Administration bring in more foreign sugar to compete against domestic production? The Department continues to do its best to operate the U.S. sugar program at no cost, exactly as the law intended," they added.
USTR did not respond to a request for comment.
The statute in OBBBA directs the administration to complete an “initial reallocation” of unused quotas “as soon as practicable.” It then says that any subsequent shortfall should be reallocated by March 1.
The Trump administration has not made any reallocations since announcing the fiscal year 2026 allocations last August.
One person familiar with the ongoing process told Agri-Pulse that USDA had gathered information on trading partners’ sugar production capabilities as far back as December.
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“They know who can perform and who can't, and who has more sugar available,” the person said. “They could do the reallocation very, very quickly, but they have not gotten a green light from the political level.”
The delay, however, runs roughshod over a compromise between the sugar growers and importers reached during the passage of OBBBA. Both parts of the sugar industry came together to support the bill on the understanding that they would both get something out of it.
The importers believed they would see tariff-rate quotas reallocated more swiftly, while the growers saw their loan rates increased from 19.75 cents to 24 cents per pound for raw cane sugar and from 25.4 to 32.77 for refined beet sugar.
“We supported higher loan rates for the producers, and in response [faster TRQ reallocation] was one of the things that we were looking for," a sugar importing industry source granted anonymity to speak frankly about the situation told Agri-Pulse.
The actual volumes of reallocated sugar quotas could be around 80,000 tons, the industry source said – not a substantial amount relative to overall U.S. imports of around 3 million tons a year. But the source said that for companies that are forced to pay the higher duty rate, the costs can be high.
The GAO notes that the in-quota tariff rate is 0.663 cents per pound, while the out-of-quota rate is 15.36 cents per pound.
This story was updated with additional comment from USDA.
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