Pasco told ConfectioneryNews that as part of the TPP agreement, which was finalized by all sides earlier this month, Australia would be allowed to provide an additional 65,000 metric tons of sugar to the US.
This would bring Australia’s total amount to 152,000.
This sugar will be duty free, he said, with no quota tariff.
Sugar agreements with Canada, Japan and Thailand
Canada had an existing sugar export quota of 10,000 metric tons, Pasco said, but will receive an additional 9,600 metric tons of refined beet sugar as part of the agreement.
“Canada has a limited production of beet sugar, as only one beet sugar processor,” he said. “That processor will have the opportunity to bring in additional sugar. It also has cane sugar refiners that import low-price raw sugar, but they would not be eligible for this. They would be bringing in world price sugar and have access under the existing 10,000 metric tons.”
In addition, US export tariffs to Vietnam, which currently stand at 20%, will be eliminated by 2026 and Japan is creating new tariff rate quotas for six different products, Pasco said, but he is still unclear which products.
As leader of an organization that is “heavily reliant on imports,” Pasco said any additional sugar that can be had from Australia and Canada is “positive news.”
“We’re like everyone else; we want to do more,” he said. “It’s a positive. We’re supportive.”
Australia would also be able to export more sugar to the US if there is a need for additional export. Pasco said under the new TPP agreement, in any increase of sugar into the US, 23% would have to come from Australia. This is something that will be reviewed on a year-to-year basis, Pasco said.
“The secretary of agriculture has limited ability to bring in additional sugar in the first six months of the year unless there’s a shortage,” he said. “Any sugar we get in addition to the minimum can’t come in until after April 1. What this would allow is more diversification in terms of sources of sugar … and timing, in terms of sugar coming in in first six months, is when we might need it most, as that’s when prices are way up.”
It had previously been reported that Australia wanted their sugar export limit raised to 500,000 tons, but that does not seem to be in the cards.
If the US was put in the same position, Pasco said confectioners and the sugar industry here would feel the same way. And for his organization, they wanted to see more come in as well. But that is all part of negotiation, he said.
“Of course we wanted more, but this is what we’ve got,” he said. “It's positive and we move on. There will be future opportunities with trade agreement. Every little bit help and you don’t want to be too negative.”
This TPP agreement is still pending Congress approval, Pasco said, noting that it is still “early days” of the agreement being approved.