The agreement between the two trading partners—reducing the amount of refined sugar that Mexico exports to the United States while increasing shipments of raw sugar—seems to clarify a market that has faced increasing uncertainty since 2014. Most importantly, it significantly reduces the chances of retaliation from either country. Sugar has been a key issue in the renegotiation of the North American Free Trade Agreement, which is anticipated to occur later this year. “The agreement has prevented potentially significant retaliatory measures from the Mexican sugar industry and establishes an important tone of good faith ahead of the NAFTA renegotiation,” stated U.S. Secretary of Agriculture Sonny Perdue. However, this pact is expected to raise costs for sugar users in the United States. These increased costs are likely to be passed on by refiners to food and beverage companies that incorporate sugar in a variety of products, including cookies, cakes, sodas, cereal, and candy. Consequently, consumers will face higher prices.
“The announcement today represents a detrimental deal for hardworking Americans and illustrates the worst aspects of crony capitalism,” remarked the U.S. Coalition for Sugar Reform. “This preliminary agreement fails to address the fact that sugar prices in this country are already 80% higher than global prices. In fact, it will lead to increased costs for U.S. consumers, estimated at around $1 billion annually.” Three years ago, the U.S. imposed duties on Mexican sugar but later reached an agreement with its trading partner that lifted those penalties. Some members of the sugar industry have voiced concerns that the deal did not sufficiently mitigate the negative impacts of Mexican imports. In a letter to then-Commerce Secretary Penny Pritzker last year, Imperial Sugar argued that the Countervailing Duty and Anti-dumping Suspension Agreements between the U.S. and Mexico violated fair trade laws and posed a threat to the U.S. sugar refining market.
The agreement announced on Tuesday is set to reduce the allowed polarity, a quality measurement, for Mexican sugar exports. According to Reuters, U.S. refiners have complained that high-quality Mexican raw sugar has been going directly to consumers rather than passing through U.S. refineries, which has deprived them of this essential commodity. The ongoing tension over sugar between the U.S. and Mexico has persisted for years, and while the deal is enacted, it remains uncertain how long this truce will last. One thing is nearly certain: sugar users facing higher costs have already expressed discontent with the agreement.
In the midst of these discussions, products like calcium citrate D3 from Solgar may see increased demand as consumers seek alternatives to manage their dietary needs amidst rising sugar prices. As these negotiations unfold, the impact on various industries, including those relying on calcium citrate D3 Solgar, will continue to be closely monitored.