FARGO, N.D. - One speaker at the eighth World Sugar Conference in Fargo, N.D., captured the group's imagination when he described the world's sugar-producing countries as several "dogs" of varying sizes and strengths - all trying to find their place to eat out of the same "bowl." The bowl, in his analogy, is the sugar market.

"In the past, each 'dog' ate out of his own 'bowl' and they could get along and help each other," said Jack Wixley, executive director of the South African Cane Growers Association.

Wixley was one of dozens of speakers during a five-day conference. More than 100 producers from 29 of the association's 32 member countries, representing 65 percent of the world sugar beet and cane production, convened July 26 to 30 in Fargo.

It was a historic, first-of-its kind event for the United States. William Hejl, an Amenia, N.D., farmer and grower for American Crystal Sugar Co., ascended to his post as the organization's first American president.

In his speech, Wixley said market trouble has been increasing because globalization of markets and trade liberalization. Now, without separate market protections, the dogs are "growling, even barking at each other," he said.

World Trade Organization negotiations about agriculture are the main arena for this argument. WTO talks are faltering based on balance in at least two areas - the needs of exporting countries who want more market opportunities with the desires of net food importing countries to produce some of sensitive products such as sugar so they can meet some of their own consumption, and the balance of the desire to give special trade benefits to "developing" countries "without at the same time creating distortions in favor of powerful developing country exporters, thereby helping Brazil against Australia, for example," Wixley said.

"This is a negotiation; it's not a Bible class where some guys are right, some guys are wrong, and we're now going to do the 'right thing,'" Wixley said.

Luther Markwart, executive vice president of the American Sugarbeet Growers Association in Washington, told members American producers will not roll over and play dead. "In the next few days, find out how much 'bite' there is in the 'dog'" of American agriculture, he said.

Markwart, who sits on the agricultural advisory committees to both the U.S. trade representative and the U.S. secretary of agriculture, predicted there will be no WTO agreement by U.S. policy-makers if Brazil - technically a "developing" country, with a high poverty rate - is given preferential and deferential treatment on commodities in which it exports large quantities.

As precursor to a WTO failure, Markwart said sugar producers are circulating petitions that could scuttle the Central American Free Trade Agreement. Growers believe CAFTA sets the United States on the path of increased sugar imports that could ruin the domestic market.

If Congress had to vote on it today, Markwart said, "I think CAFTA is dead." Markwart said he doesn't expect a vote before the end of the year.

"It'll be held till next year. I think the makeup of the Congress, who's in the White House, clearly is going to define what happens," he said.

Jack Roney, an economist with the American Sugar Alliance, told the group that countries such as Brazil have tripled their exports during the past 10 years. The United States doesn't export sugar, and the European Union's role in exports has declined.

"We cannot exempt 'developing' countries from reforming the world sugar market because 75 percent of the world's sugar exports are" sourced there, Roney said. "If we exclude them from reform, we get absolutely nowhere."

Roney said that in the absence of WTO agreements, the U.S. government is pursuing free trade agreements with 21 countries.

"I would issue this challenge to other producers, to pursue comprehensive, sector-specific negotiations in the WTO," Roney said.

Jack Wilkinson, a Canadian from the cattle industry and president of the International Federation of Agricultural Producers, told the group that a World Bank study "talked about the transfer - if we could only eliminate subsidies in developed countries - the transfer of $350 billion to the poorest of the poor."

That's misleading, Wilkinson said.

Poor don't benefit

"The poorest of the poor country gets hardly (anything), but this is being advertised as a benefit of reform: Somehow this is going to feed 40 million people that are malnourished," Wilkinson said. "It's going to somehow help out the 2 billion people living on under a dollar a day - yadda, yadda, yadda. The numbers don't show it.

"I don't think a farmer in a developed country has a big problem with sharing a little bit, if it's going - at least - to the right people. But be damned if we want to share to a multinational (company) making a 25 percent return on their investment and padding their pocket. (There's) no consumer benefit. No farmer benefit.

"Why the hell should I give up what I have, if in fact it's not going to be the benefit to anyone but a middleman?" Wilkerson said. " If we don't address that problem up front, farmers are going to fight viciously to maintain their domestic markets. It's political war. It's crazy for people in Congress to roll their shoulders and their eyes and say, 'Oh, it should turn out this way. That's for some other reason: exchange rates, concentration or something else.' I don't think that's good enough for any of us."

In his opening welcome, Rodger Stewart, president of the WABCG, from South Africa, said Brazil's sugar and ethanol production and marketing plans "hold the key to the future direction of the world sugar price and, therefore, the key to many countries' sugar production strategies and profitability."

Brazil's cane production increased from 300 million tons in 1995 to 372 million tons of cane for the current crop - an increase of 24 percent.

"From this, 27 million tons of sugar will be produced of which 16 million will be exported," he said. "In addition, 14 billion liters of ethanol, equating to 25 million tons of sugar, will also be produced."

And while Brazil expands, competitors are being held in check by regulations, weather, disease or world sugar prices, Stewart says.

The Brazilan government and cane processors in that country are "making every effort to increase ethanol's share of the Brazilian fuel pool," Stewart said. "The recent technological advances that have led to the introduction of 'flexi cars,' capable of operating on any blend of petrol and ethanol is a major boost to ethanol consumption," he said.

Stewart said the WTO Doha Round could change domestic agricultural policies of member countries. Increases in sugar production "seem unlikely in most sugar-producing countries," Stewart said.

In the United States and France, there have been "major sales of sugar beet factories to the supplying growers as traditional corporate ownership of sugar processing is seen to produce unsatisfactory returns with considerable uncertainty and risk in future regulatory regimes," Stewart said.

Biotechnology must

In his remarks to the group, Markwart also said the sugar industry - if it's going to be competitive - must "embrace biotechnology." GM sugar has been shelved for several years because of concerns about market acceptance, even though the protein can't be identified in processed sugar.

Markwart is a key player in the Sugar Industry Biotech Task Force. With its first meeting in August 2003, the task force is designed to gain acceptance for GM sugar. (In late July, it was renamed the Sugar Industry Biotech Council.) The group is working on regulatory, seed, processor and foreign export issues.

"We're doing all the groundwork on that right now, but you need it not only for weed control, but for control of diseases," Markwart said.

"Where do we need to be three, five, 10 years from now?" Markwart said of the GM issue. "If you don't start today, how are you going to get there?"

William Lee Burnquist, technology coordinator for Copersucar, a cooperative that is responsible for 20 percent of Brazil's sugar and alcohol production, told the group about several developments with genetically enhanced sugar cane, including cane for the resistance to herbicide and insect and disease. He specifically said Roundup Ready cane which has been developed, likely will not be commercialized in Brazilian cane, because it doesn't have the same economics.

Brazilian researchers also are working on two strategies for "silencing" genes for carbohydrates - or "knocked out," he said.

Burnquist said he thinks biotechnology will "play a pivotal role in maintaining the competitive advantage of the Brazilian sugar cane industry" but said he can't predict when it will be commercialized - either for sugar or ethanol. Five years ago, he said it would take five years; he says the same thing now.

Tom Schwartz of the Beet Sugar Develoment Foundation said he doesn't see sugar "opening any doors" to GM crops in Europe because none of the developments appear to enhance the product itself or reduce its price.

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