A preliminary agreement has been reached between the U.S. and Mexican governments to prevent what the Department of Commerce has said is the illegal dumping of sugar on U.S. markets at low prices.
The deal follows the department’s preliminary finding this week that the Mexican government dumped sugar on the U.S. market at a price lower than legally allowed, which effectively hurts the sugar industry in Louisiana and other states.
In September, the department ruled in favor of a duty deposit on sugar imports from Mexico after making a preliminary determination that the Mexican government illegally subsidized sugar exported to the U.S.
Pending a final agreement with Mexico, the Commerce Department has agreed to suspend its antidumping and countervailing duty investigations.
If a final agreement is not reached, the Commerce Department and International Trade Commission will make a final determination regarding the subsidies issue.
If the ruling is in favor of U.S. sugar producers, Commerce will order U.S. Customs and Border Protection to collect countervailing duties from Mexican sugar producers to cover the impact on American sugar producers. Commerce would make a final determination in early 2015.
In March, U.S. sugar producers filed antidumping and countervailing duty petitions against Mexican sugar producers with the International Trade Commission and Commerce Department. In April, the Commerce Department agreed to investigate the Mexican sugar industry.
In 2013, there were 479 sugar producers in Louisiana farming sugar cane on 439,236 acres in 23 parishes, supporting 11 operating mills. An estimated 3.2 billion pounds of sugar and 96.5 million gallons of molasses were produced. The industry represented a gross farm value of $455 million.