AGES No. (AGES-9006) 93 pp
Sugar: Background for 1990 Farm Legislation
This report address considerations in the 1990 farm bill debate for sugar, including market conditions, policy proposals, trade agreements, and the interactions between policy and markets for selected commodities. The sugar support program and rapid adoption of high fructose corn syrup (HFCS) played important roles in transforming the U.S. sugar industry in the 1980's. While sugar output and productivity increased, consumption of sugar fell dramatically as HFCS displaced sugar in many uses, particularly beverages. After a decade of steady decline, sugar consumption in 1987 began rising at a slow rate. U.S. imports of sugar for consumption fell from an average of over 4 million short tons in 1979-81, to about 1 million tons in 1988. U.S. sugar import quotas have been binding since May 1982, to keep prices at levels required by the sugar program. Regional sugar balances have altered in the 1980's, and beet sugar now provides about 45 percent of U.S. sugar use, up from about 30 percent. The world sugar market changed much in the past decade, moderating the price cycle and extending the period of persistently low prices.
Keywords: sugar, costs and returns, imports, quotas, HFCS, low- calorie sweeteners, program effects, world sugar
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