U.S. SUGAR POLICY MAY SELF-DESTRUCT, CONGRESSMAN

  A leading U.S. farm-state
  Congressman, Jerry Huckaby, D-La., warned he will press next
  year for legislation to control domestic production of
  sweeteners, perhaps including corn sweeteners, if the industry
  fails to voluntarily halt output increases this year.
      "We're moving toward a direction where we could
  self-destruct (the U.S. sugar program)," Rep. Huckaby, chairman
  of the House agriculture subcommittee dealing with sugar
  issues, told Reuters in an interview.
      Huckaby, who told U.S. sugarbeet growers earlier this year
  they must halt production increases, said he will deliver the
  same message to Louisiana sugarcane growers Friday. He also
  said he will soon talk with corn refiners on the subject.
      Huckaby said the campaign to urge a halt to domestic
  sweetener output increases is an effort to forestall further
  cuts in the sugar import quota, now at one mln short tons.
      "I think if we're talking about dropping (the quota)
  another half mln tons, lets say, you're getting to the point
  where the program might not work," he said.
      "Ideally, I'd like to freeze things right where we are,"
  said Huckaby, leading advocate for sugar growers in Congress.
      A freeze would mean domestic sugar production at about the
  current level of 6.5 mln tons, the corn sweetener share of the
  U.S. market staying at just over 50 pct, and U.S sugar imports
  holding at about 1.2 mln tons, Huckaby said.
      A decision on whether to seek legislation will not be made
  until 1987 output numbers are known late this year, he said.
      "I feel like if we didn't expand production, we could
  probably hold where we are indefinitely, or at least through
  the 1985 farm bill without any changes (in the sugar program),"
  Huckaby said.
      However, much depends on whether high-fructose corn syrup
  producers continue to expand their share of the U.S. sweetener
  market from just over 50 pct, Huckaby said.
      He noted most estimates are that corn sweeteners will
  capture at most only another 10 pct of the sweetener market in
  the U.S.
      But he said if there were an economic breakthrough in the
  production of a new crystalline corn sweetener which further
  expanded the corn sweetener share, then U.S. sugar imports
  might be eliminated and U.S. sugar output severely reduced.
      Huckaby said he will deliver this message to corn refiner
  companies such as A.E. Staley and Archer Daniels Midland soon.
      "This program is advantageous to the corn users. They have
  some natural, legitimate self-interest in seeing that the
  program is preserved," Huckaby said.
      Huckaby said he has asked sugar industry representatives to
  think about how domestic output could be controlled, either
  through production allocations, acreage or marketing controls.
      Huckaby also said he would be seeking guidance from the
  Justice Department to determine if it would be legal to ask
  corn refiners to limit production.
      "I don't know if we will go this route, but if we do
  there's a question in my mind at this point in time; can you do
  that legally?" he said.
      Asked if he would proceed with production controls without
  the support of corn refiners, Huckaby said "You build a fragile
  house if you do it that way."
      Huckaby said he understands why U.S. cane and beet farmers
  have expanded production, because high sugar price support
  means returns from sugar are higher than competing crops such
  as soybeans and grain.
      But he said for sugar growers as a whole, expansion would
  not be good policy.
      Huckaby said he has tried to stress, in his speeches to
  sugar industry groups, that if growers continue to expand, they
  may be penalized retroactively under any production control
  legislation passed next year.
      Huckaby said Congress is unlikely to approve any changes in
  the sugar program this year despite a Reagan administration
  proposal to drastically slash the program.
      "The administration proposal is so drastic, that I don't
  think it will get up a head of steam," Huckaby said.
      He said even a more moderate proposal to reduce sugar price
  support is unlikely to be approved.
      Instead of seeking to slash the domestic sugar program,
  Huckaby said the Reagan administration should file a complaint
  with the General Agreement on Tariffs and Trade against the
  European Community's sugar policy. He said EC policies are the
  major cause of the depressed world sugar market.
  

