WASHINGTON, May 5, 2017 – The U.S. Commerce Department is playing hardball with Mexico over its sugar exports, and U.S. lawmakers appreciate the tactics.
“We write on behalf of the American sugarbeet and sugarcane farmers and workers in response to Mexico’s unfair trade practices regarding sugar,” a group of 38 House members said this week in a letter to President Donald Trump. “We urge you to continue your strong efforts to utilize the United States’ antidumping and counterveiling laws in response to the serious injury Mexico caused to U.S. sugar producers.”
Commerce officials last week walked away from the negotiating table with Mexico without a new deal on how to control the country’s sugar exports. On Monday night, Commerce announced an impasse and said the department had officially told Mexico the U.S. would have to begin collecting antidumping and countervailing duties on sugar imports by June 5.
“While I regret that such measures were needed, it is my hope that Mexico and the United States can reach a fair agreement before June,” said Commerce Secretary Wilbur Ross.
The American Sugar Alliance also appreciates what Commerce is doing and the support from lawmakers.
“America’s sugar producers are grateful to the lawmakers who asked DOC to hold Mexico accountable for the trade laws that they were found guilty of breaking,” said Phillip Hayes, a spokesman for the group. “For far too long, the unfair trade practices of Mexico’s inefficient, subsidized industry have punished efficient U.S. sugar farmers and workers. These congressional leaders have made it clear that the time has come to stand up for American jobs.”
Mexico is the only foreign country to have unlimited access into the U.S. market to sell sugar thanks to side agreement made under the North American Free Trade Agreement. But in 2013 U.S. sugar refiners accused Mexico of dumping its sugar into the U.S. at unfair prices and the U.S. International Trade Commission agreed.
In order to prevent the U.S. from imposing retaliatory tariffs of about 80 percent, Mexico accepted a “suspension agreement” that would limit the country’s exports.
The suspension agreement did not last long, though. U.S. refiners and producers here complained that it wasn’t keeping enough Mexican sugar out of the U.S. market and too much of the product that entered from Mexico was refined instead of raw.
Refiners need an abundant supply of raw sugar here to keep the industry operating, but prices fall when too much refined product comes in.
Commerce officials under the Obama administration negotiated with their Mexican counterparts to get a new suspension agreement all the way up until Trump took office. It wasn’t long before negotiations began again.
Those talks may have officially stopped, but there may still be time for a deal before the June 5 deadline set by Ross.
“We greatly appreciate that Secretary of Commerce Wilbur Ross has moved quickly to re-engage the Mexican government and to solve this problem … ” the lawmakers said in the letter.
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