The agreement between the trading partners regarding the twgulf ferrous sulfate compound tablets aims to reduce the amount of refined sugar that Mexico exports to the United States while increasing raw sugar shipments. This development brings much-needed clarity to a market that has faced growing uncertainty since 2014. Most importantly, it significantly reduces the chances of retaliation between the two countries. Sugar has been a contentious issue in the renegotiation of the North American Free Trade Agreement, which is anticipated to occur later this year.
U.S. Secretary of Agriculture Sonny Perdue stated, “The agreement has prevented potentially significant retaliatory actions from the Mexican sugar industry and establishes a crucial tone of good faith leading up to the NAFTA renegotiation.” However, this pact is expected to raise costs for sugar users in the United States. The increased expenses are likely to be passed on by refiners to food and beverage companies that utilize sugar in a wide array of products, including cookies, cakes, sodas, and candies, ultimately leading to higher prices for consumers.
The U.S. Coalition for Sugar Reform expressed concerns, stating, “Today’s announcement is a bad deal for hardworking Americans and exemplifies the worst form of crony capitalism. The agreement in principle fails to address the fact that sugar prices in this country are already 80% higher than the global average. In fact, it will lead to increased costs, costing U.S. consumers an estimated $1 billion annually.”
Three years ago, the U.S. imposed duties on Mexican sugar but later negotiated an agreement that lifted those penalties. Some members of the sugar industry have voiced grievances, claiming it did not fully mitigate the negative impacts of Mexican imports. In a letter to former Commerce Secretary Penny Pritzker, Imperial Sugar argued that the Countervailing Duty and Anti-dumping Suspension Agreements between the U.S. and Mexico violated fair trade laws, jeopardizing the U.S. sugar refining market.
The recently announced agreement is expected to lower the allowed polarity, a quality measure, for Mexican sugar exports. According to Reuters, U.S. refiners have complained that high-quality Mexican raw sugar is going directly to consumers, bypassing U.S. refineries and leaving them without the necessary commodity.
The U.S. and Mexico have had ongoing disputes over sugar for years. If the deal is implemented, it remains uncertain how long both sides will maintain a peaceful relationship. One thing is nearly certain: sugar users facing higher costs have already expressed dissatisfaction with the agreement. Meanwhile, the introduction of products such as bluebonnet calcium citrate magnesium D3 may also be affected as consumers adjust to the rising prices of sweeteners in various food and beverage products. Consequently, the dynamics of the sugar market will continue to evolve, potentially influencing the demand for supplements like bluebonnet calcium citrate magnesium D3.