(Jerry Hagstrom) – The American Sugar Alliance, which represents cane and beet growers, today released a study showing that U.S. sugar policy has not hurt the sugar-containing products industry.
The study, prepared for the ASA by University of Maryland Business School Dean Alex Triantis, says that between 2009-2014 — a period that included a U.S. economic recession and unusually high world and U.S. sugar prices — sugar-containing industry jobs rose by 3 percent, while non-sweetened-food industry jobs were flat.
The report also said that sugar-containing products (SCP) companies have also experienced strong revenue growth, high proftability and high returns on equity “even when sugar prices increase.”
In a news release, ASA said Triantis examined the nine largest publicly held SCP companies and found that their share prices more than doubled in the past 15 years — nearly triple the growth of the Standard & Poor’s Index and that SCP companies realized profit margins that were 67 percent higher than the overall food processing industry.
Triantis also said that, while companies making products containing sugar are largely insulated from fluctuation in the cost of sugar, U.S. sugar producers are vulnerable to policy changes that would affect prices. Over the past 25 years, he said, sugar-growing industry employment has dropped roughly 40 percent because sugar prices have fallen by 40 percent over that same period, when corrected for inflation.
“While employment in sugar growing and processing has declined significantly over the past two decades,” Triantis concluded, “the sugar sector still supports a large number of jobs that would be at high risk of disappearing if the current U.S. sugar policy were to be significantly modified or rescinded.”
Mr. Hagstrom publishes THE HAGSTROM REPORT, a news service providing original national and international agricultural news to its subscribers. It covers congressional hearings, markups and press conferences in Washington D.C., as well as farm meetings throughout the United States
