Katrina hits sugar market

Dairy Foods, Oct, 2005 by J. Mark Huffman

Hurricane Katrina made an already tight U.S. sugar market even tighter as the storm battered the Gulf coast. In response, USDA is increasing the current fiscal year's domestic marketing allotments and has allowed early entry of some imports scheduled for the new fiscal year. USDA is increasing the current fiscal year (FY05) overall allotment quantity by 105,000 short tons raw value (STRV), 55% of which is assigned to the domestic sugar beet sector. The remaining 45% will be reassigned to additional imports, since there are no U.S. cane sugar stocks available. USDA is also increasing the fiscal year 2006 tariff-rate quota for refined sugar imports by 75,000 STRV for a total of 129,013 STRV, which will be allocated on a first-come, first-serve basis. The devastation to Louisiana hit the domestic sugar industry particularly hard, since the state is home to major cane refineries, cane mills and growing cane crop. Two major refineries had to shut down, at least temporarily, due to the storm's impact, a loss of about 5,550 tons of refined sugar each day closed.

Dairy manufacturing interests are lining up against a Congressional measure that would create new import tariffs on some dairy proteins. IDFA has put together a coalition of consumer and food groups to oppose the legislation, which opponents say could become part of this year's miscellaneous trade bill. The measure is now under review by the House Subcommittee on Trade.

USDA's Food Safety and Inspection Service is reviewing the comments it has received regarding the financial impact of the Hazard Analysis Critical Control Point (HACCP) regulations on small and very small plants. FSIS is conducting a review of the regulations established by the Pathogen Reduction/HACCP final rule under Section 610 of the Regulatory Flexibility Act. These provisions require all Federal agencies review existing regulations that have a significant economic impact on a substantial number of small entities to determine whether the impact can be minimized. Small plants are defined as having between 10 and 499 employees or more than $2.5 million in annual sales. Very small plants have fewer than 10 employees or less than $2.5 million in annual sales.

J. Mark Huffman is Dairy Foods' Washington correspondent. Contact him at: 7406 Alban Station Court, Suite A-118 Springfield, VA 22150 phone 7031866-1934 email: annews@crosslink.net