97 



Burning Our Bridges Behind Us? 



• If the American market is so attractive 



for a country which must import most of its 

 sugar, countries which rely on sugar exports as 

 their major agricultural income will be even 

 more aggressive in their approach to the market. 



• Currently, the U.S. sugar program is net 

 zero cost. However, if substantial amounts of 

 sugar from U.S. farmers enter the CCC loan 

 program and are forfeited, U.S. taxpayers will 

 have to foot the bill. 



• If the U.S. continues to import massive 

 amounts of sugar, the federal government will 

 likely discontinue the price support program, 

 following the trend of cut-backs on other 

 American farm programs such as wheat and feed 

 grains in recent years. 



• If the U.S. sugar industry goes by the 

 wayside and U.S. consumers must rely on sugar 

 supplies from parts of the world which have long 

 histories of civil unrest and instability, we are in 

 for extreme price fluctuations. 



most glaring example is that Canadian exports 

 of peanut butter and peanut paste to the United 

 States have risen from 6 million in 1989 to 40 

 million pounds in 1992. That is a six- fold 

 increase in a mere three years. 



According to an April 6, 1993, article by the 

 Georgia Peanut Commission entitled. The 

 Effect of Peanut Paste Imports on The U.S. 

 Peanut Industry and the Price Support 

 Program," these products can be brought in to 

 the U.S. at a cost 25-cents-per-pound lower than 

 the price of domestically grown and processed 

 peanuts. 



This means that much of the U.S. domestic 

 peanut production must be purchased by USDA 

 at a price that is higher than the cost of 

 Canadian peanut imports. For 1993, these 

 purchases could cost the federal government $17 

 million to S18 million. 



If the trend should continue to a point where 25 

 percent of the U.S. production is forfeited to 

 USDA, the cost to American taxpayers could 

 exceed $100 million per year well before the turn 

 of the century. 



An End to U.S. Peanut 

 Production? 



WE'RE NOT TALKING 

 PEANUTS HERE 



Canadian Manufacturers Benefit 

 at U.S. Expense 



It is not as though the U.S. trade problem with 

 Canada is related to only the crops grown on 

 the northern tier of states, or that the effects of 

 the CFTA are felt only by those areas which 

 grow durum, hard red spring wheat, sugar beets, 

 and barley. The problem now affects crops 

 grown in the Southern U.S. and involves crops 

 which Canada does not produce at all. The 



As with sugar, the result of these burgeoning 

 costs would likely be a massive overhaul of the 

 U.S. peanut program which could simply 

 translate into a program phase-out. In the case 

 of the exploding peanut butter and peanut paste 

 import problem, the United States finds itself 

 sabotaging not only its peanut growers but its 

 peanut processing industry. The U.S. will 

 continue to encourage the construction of 

 state-of-the-art plants in other countries by 

 willingly accepting their products. 



Finally, the plants which are constructed abroad 

 for the purpose of taking advantage of U.S. 

 markets will have a life span of several decades 

 and will affect the competitiveness of American 

 producers for as long. 



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