TPP results may save Lantic sugar plant from closure

A deal reached during the recent Trans-Pacific Partnership trade talks appears to have gained more U.S. market access for Canadian beet sugar.

The deal would see 9,600 tonnes of beet-specific sugar sold into the U.S. sugar market and another 9,600 tonnes of refined sugar quota from unspecified origin.

Rob Boras, president of Canadian Sugar Beet Producers, and Gerald Third, executive director of that group and of Alberta Sugar Beet Growers, attended the TPP talks and had several “robust discussions” with Canadian trade negotiators and members of the Canadian Sugar Institute while there, said Third.

The results of the deal, which Third termed a bilateral agreement on sugar, will save the Lantic sugar factory in Taber, Alta., from closure, which he thinks would have been inevitable without a beet specific sugar agreement.

“Are we happy? Yes, we’re ecstatic in some regards that we were able to secure a bilateral agreement that maintains Taber’s presence in Alberta and in Canada,” said Third.

“We’re very, very pleased with that. We’re disappointed, however, in the volume. We were hoping for greater access. On that side of it, we’re disappointed.”

The 19,200 additional tonnes of access for Canadian sugar is on top of established tariff rate quotas (TRQ) of 10,300 tonnes through the World Trade Organization agreement and 59,250 tonnes for sugar-containing products.

Third said the additional market access is “a drop in the bucket” in terms of the total market.

Canadian Sugar Institute president Sandra Marsden agreed.

“This is a step in the right direction, but it’s small in relation to the 11 million tonne U.S. sugar market,” she said in an interview with Reuters.

The CSI represents Canada’s two sugar companies, Lantic and Redpath. Lantic owns and operates the sugar factory in southern Alberta.

A point of contention for Canadian sugar beet growers revolves around the origin of the sugar that is marketed.

Under existing rules, Canada’s refined sugar allocation under the TRQ must be filled by sugar entirely produced in Canada.

However, Third said there were efforts during negotiations to equate refining with origin, which would open the door for Canadian sugar companies to import cane sugar, refine it and sell it as Canadian product.

“Refining conferred origin would mean that all imported sugar that Lantic and Redpath bring in would automatically become Canadian by legal definition under the trade agreement, which is horrible for us,” said Third.

He said closure of the Taber plant would be inevitable if that were to happen. The plant employs 150 people full time and double that during fall and winter,.

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