Central Pennsylvania candymakers The Hershey Co. and The Warrell Corp. have lent their voices to U.S. Sen. Pat Toomey's aid in trying to end sugar market controls and subsidies the manufacturers say hurt their bottom line.
Toomey, Pennsylvania’s Republican senator, co-sponsored a bill Thursday to end sugar market controls and subsidies that he and manufacturers say drive up food prices by preventing them from buying more sugar on the international market.
“It’s time to reform the government’s wasteful sugar program. This flawed policy hurts not only candy companies and food manufacturers, but also the families who end up paying higher costs for products made with sugar,” Toomey said in a statement.
Farm groups and sugar producers counter that’s not true and say such changes will dramatically hurt U.S. beet and cane farmers, and will gut the domestic market so manufacturers can spend less on foreign sugar without passing the savings on to consumers.
Wholesale sugar prices have declined 47 percent since August 2010, yet consumer food product prices have increased, according to the American Sugar Alliance, citing data from the U.S. Department of Agriculture and Bureau of Labor Statistics.
The National Farmers Union opposed Toomey’s similar amendments to agricultural bills last year that would dismantle the USDA sugar programs.
Both sides are spending a lot of money to lobby Congress on this and similar issues that cross manufacturing, agriculture and labor policy.
Hershey spent $1.2 million lobbying Congress in 2012 either on its own or through firms it hired, according to a search of the Senate Lobbying Database. The National Confectioners Association, the primary trade group for candymakers, spent $660,000 in 2012.
The National Farmers Union spent $46,000 last year lobbying Congress, according to the database, which also tracks spending in the U.S. House of Representatives. The Sugar Alliance spent far more: $1.9 million.
But these are a fraction of the groups and companies that spend money every year to convince Congress that one set of policies or another is best for their industry and the country.
Here are the provisions of Toomey’s bill:Repeal the Feedstock Flexibility program, which requires the federal government to buy surplus sugar to sell to ethanol companies. The program will cost $193 million in the next 10 years, according to Toomey.
• Repeal unnecessary trade restrictions, freeing up the agriculture secretary to increase sugar imports when domestic supplies do not meet demand.
• Give the USDA more flexibility in administering the import quota system, allowing qualifying countries to trade their quotas for sale to U.S. markets.
• Reform domestic supply restrictions, giving the USDA more flexibility to modify or suspend marketing allotments.
• Eliminate higher price support levels, reducing taxpayers’ liability.
What local candymakers said in supporting Toomey’s bill:
“Hershey strongly supports the efforts of Sen. Toomey and his colleagues to advance market-oriented reforms of the U.S. sugar program by rolling back the costly provisions added in the 2008 farm bill. Sen. Toomey’s amendment would benefit American consumers by providing the food and beverage industry with much-needed relief from tight sugar supplies and artificially high prices.” – Terry O'Day, Hershey senior vice president of global operations, Derry Township, Dauphin County.
“Sen. Toomey’s amendment to reform the sugar program will repeal some aspects of the sugar policy that impede a competitive marketplace for sugar. This is about jobs here in Pennsylvania, including here at Warrell. We applaud Sen. Toomey’s leadership on behalf of the state’s confectionery industry.” – Kevin Silva, Warrell senior vice president, Hampden Township, Cumberland County.