Small and medium sized US confectioners are coming under increasing threat from foreign firms that are able to secure sugar supplies at less than half the going rate in the US, according to the Kimmie Candy Company.
The Nevada-based firm, which produces brands such as ChocoRocks, is calling for removal of subsidies and import duties on US sugar in the 2012 Farm Bill and recently invited Congressman Mark Amodei to its factory to put across its view.
Speaking to ConfectioneryNews.com, Kelli Post, retail manager for Kimmie Candy, said: “There is an advantage for foreign chocolate companies who have access to the world pricing of sugar which is about $0.20 lb. and in the USA due to the government subsidy on US sugar and import quotas is $0.49 lb. to domestic users.”
“You can see that companies like Spangler and Hammonds who make candy canes which are mostly sugar are at a disadvantage in the USA market because there are manufactures in Mexico and Canada who have much cheaper sugar prices,” she said.
High consumer prices
Post called the current sugar regime “outdated” and said it lead to higher consumer prices for bakery and confectionery products which hit low-income families the hardest.
“The owner of Kimmie Candy was a sugar beet grower 20 years ago and at that time of low commodity prices it keep farmers viable but in today’s high commodity prices there are alternative crops that make a farmer viable money,” she added.
All major confectioners such as Mars have pumped big bucks into lobbying for sugar reform. See HERE.
Producers claim surpluses
American Sugar Alliance, a producer’s organization, has argued that confectioners are enjoying sugar surpluses, while “padding their profits” and campaigning for deregulation.
The US Farm Bill is due for renewal every five years.
Congress is set to revise the bill this year as the current law, the Food, Conservation, and Energy Act of 2008, is set to expire.