Penn Speech Not a Hit With Sugar Growers - Ag Undersecretary Says Little About Sugar, Trade

VAIL, Colo. - U.S. sugar beet and cane growers have spent their annual meeting lamenting the impact of a recent Bush administration decision on sugar price and the potential negative impacts of trade agreements, but they received no sympathy from Agriculture Undersecretary for Farm and Foreign Agricultural Services J.B. Penn - and in reaction, the growers said President Bush may suffer at the polls.

The growers are upset about a July 16 announcement that sugar processors can market 8.1 million short tons of sugar in 2004 and 2005. The growers say that the allocation is too large and that it has caused the price of sugar to plummet, leading growers to forfeit sugar to the government. Under the farm bill, the growers and members of Congress have noted, the Agriculture Department is supposed to run the sugar program in a way that does not result in the forfeitures that are allowed if prices fall. Sen. Kent Conrad, D-N.D., said in a letter to Agriculture Secretary Ann Veneman that USDA is not running the program as Congress intended.

'A template speech'

Penn, who oversees the sugar program, spoke to the American Sugar Alliance Aug. 11, but he barely addressed sugar prices or trade issues. Penn gave a half-hour speech, but spent all the time discussing the high prices of other crops and trade and export opportunities even though the United States does not export sugar and sugar prices are depressed. Penn did make two comments that growers said pleased them. He said USDA would consider adjusting the allocations later in the year. In a discussion of the World Trade Organization, he said, "It makes no sense for Brazil to be treated as a developing country" when it has a "First World" agriculture industry. Under WTO rules, developing countries get extra time to adjust to changes in trade agreements such as reductions in farm subsidies.

Sugar executives and growers from throughout the country said they were disappointed in Penn's speech, with Florida and Louisiana growers particularly outspoken. Robert Coker of the U.S. Sugar Corp. in Clewiston, Fla., who noted that he has donated $100,000 to the Bush campaign and is a Bush "Pioneer," said Penn "was very artful. He did not say a lot. Farmers in Florida across the board - the sugar, citrus and vegetable people - are watching very carefully all these decisions by the administration. A lot of farmers see the administration putting import-sensitive commodities on the table as their bartering tool in trade negotiations." Coker added, "I'm a supporter of W. I hope he is going to make appropriate statements that (Florida farmers) can support. I hope they come soon. I am concerned that USTR continues marching toward free trade at all costs."

Disappointed listeners

Noting that Vice President Dick Cheney said Aug. 6 in a speech in Minnesota that trade issues should be handled in the World Trade Organization rather than bilateral negotiations, Coker said, "Vice President Cheney is not negotiating these trade agreements. (U.S. Trade Representative) Bob Zoellick is. Someone needs to make sure Zoellick knows what administration policy is."

Carolyn Cheney, a lobbyist for the Sugar Cane Growers Cooperative of Florida and the outgoing chairman of the alliance, said Penn "painted a picture out there of continuing with these trade agreements. It's obvious we're not on the train and we're going to have to do something about it."

Barbara Miedema, a vice president of the Sugar Cane Growers Cooperative, said in his formal presentation "he never mentioned sugar once. These record-high prices don't relate to sugar or citrus."

A Florida grower who declined to give his name said, "That was pitiful, just pitiful. I've been voting Republican all my life, but I'm voting for John Kerry. That speech convinced me."

Jackie Theriot, a Louisiana producer, said, however, that he believes most sugar growers in his state already have "made up their minds on how they are going to vote. Anyone who has to hammer my industry and destroy my livelihood I can't support."

Midwestern sugar beet growers also expressed disappointment but not in such colorful terms. Luther Markwart of the American Sugarbeet Growers Association and the incoming chairman of the alliance said, "obviously it was a template presentation he could give to several groups."

Kevin Price, a lobbyist for American Crystal Sugar in Fargo, N.D., said Penn had told the growers "we are in the most aggressive trade policy era in U.S. history. But he gave no advice to the sugar industry."

Steve Williams, a Crookston, Minn. grower, said, "His comments did not indicate a change in policy on the administration's part."

Ray VanDriessche of Monitor Sugar Beet Growers in Michigan said, "We didn't hear what we wanted. I hope they take the opportunity to reassess what they did."

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