Sugar Producer

22 SUGAR PRODUCER | APRIL 2022 As the pastel colors of spring sweets line store shelves and we gear up for one of the largest candy holidays of the year, a recent study has shed new light on the relationship between sugar prices and the retail cost of sugar- containing products. This study was among the papers presented at the Southern Agricultural Economics Association's (SAEA) annual meeting in February, not far from the old grounds of the Louisiana Sugar Doing Your Part American sugar farmers and workers keep providing a reliable, affordable product. FROM THE ASA By Rob Johansson, Director of Economics and Policy Analysis and Rice Exchange in New Orleans. Karen DeLong and Carlos Trejo-Pech, agricultural economics professors from the University of Tennessee, took the stage at the SAEA meeting to present the findings from their latest study on sugar. DeLong and Trejo-Pech are no strangers to sugar policy. They previously found that U.S. sugar prices did not harm the financial performance of food manufacturers. Contrary to longstanding claims from Contrary to longstanding claims, the prices charged for sweetened products are not closely tied to the price that food manufacturers pay for sugar. corporate candy companies, this most recent study finds that the prices charged for sweetened products, such as the jellybeans in your Easter basket, are not tied to the price that food manufacturers pay for sugar. In other words, when corporate food manufacturers source sugar at higher or lower costs, they don't change the prices they charge consumers for their sugar-containing products. The researchers pointed to the affordability of sugar as one factor why. Despite being a primary ingredient in the products they analyzed, sugar accounted for less than 2.6% of a product's price, on average. For example, a $1.49 chocolate bar contains less than 2 cents' worth of sugar. "U.S. sugar policy does not harm sugar- using firms," the researchers concluded, firmly rejecting the tired arguments made by corporate candy companies and farm policy critics in their attempts to gut sugar policy. America's sugar policies are designed to ensure that we always have a reliable and affordable supply of sugar, all at no cost to taxpayers. Those policies prevent heavily subsidized foreign producers from dumping their excess sugar on our market while maintaining America's position as the third-largest sugar importer in the world. The strong supply chain for sugar built by American sugarcane and sugarbeet farmers and workers allowed refined sugar supply streams to adjust and meet the new demands for retail sugar driven by COVID-19. The American sugar industry pivoted quickly to shift 99,000 tons of sugar from manufacturing to retail consumers in the first three months of the pandemic, equivalent to about 50 million extra 4-pound bags of sugar at the grocery store. So, thank you to America's sugar farmers and workers. We appreciate all you do to contribute to our local communities, the rural economy, and our national food security. n

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