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Sugar from Mexico Sugar from Mexico Investigation Nos. 701-TA-513 and 731-TA-1249 (Preliminary) Publication 4467 May 2014 U.S. International Trade Commission Washington, DC 20436 U.S. International Trade Commission COMMISSIONERS Irving A. Williamson, Chairman Dean A. Pinkert David S. Johanson Meredith M. Broadbent F. Scott Kieff Rhonda K. Schmidtlein Robert B. Koopman Director of Operations Staff assigned Amy Sherman, Investigator Michael Szustakowski, Investigator Douglas Newman, Industry Analyst James Fetzer, Economist Charles Yost, Accountant Russell Duncan, Statistician Darlene Smith, Statistical Assistant Karl von Schriltz, Attorney Elizabeth Haines, Supervisory Investigator Address all communications to Secretary to the Commission United States International Trade Commission Washington, DC 20436 U.S. International Trade Commission Washington, DC 20436 www.usitc.gov Sugar from Mexico Investigation Nos. 701-TA-513 and 731-TA-1249 (Preliminary) Publication 4467 May 2014 CONTENTS Page Determinations ............................................................................................................................... 1 Views of the Commission ............................................................................................................... 3 Part I: Introduction ................................................................................................................ I‐1 Background ................................................................................................................................ I‐1 Statutory criteria and organization of the report ..................................................................... I‐2 Statutory criteria ................................................................................................................... I‐2 Organization of report ........................................................................................................... I‐3 Market summary ....................................................................................................................... I‐3 Summary data and data sources ............................................................................................... I‐4 Previous and related investigations .......................................................................................... I‐4 Nature and extent of alleged subsidies and sales at LTFV ........................................................ I‐6 Alleged subsidies ................................................................................................................... I‐6 Alleged sales at LTFV ............................................................................................................. I‐7 The subject merchandise .......................................................................................................... I‐7 Commerce’s scope ................................................................................................................ I‐7 The product ............................................................................................................................... I‐8 Description and applications ................................................................................................. I‐8 Manufacturing processes .................................................................................................... I‐10 Tariff treatment ....................................................................................................................... I‐12 Tariff‐rate quotas on U.S. imports ....................................................................................... I‐13 U.S. sugar program .................................................................................................................. I‐17 History ................................................................................................................................. I‐17 1996‐2002 ............................................................................................................................ I‐17 2002–2008 ........................................................................................................................... I‐18 2008–Present ....................................................................................................................... I‐21 Domestic like product issues ................................................................................................... I‐23 Raw sugar and refined sugar ............................................................................................... I‐24 Beet sugar and cane sugar .................................................................................................. I‐25 i CONTENTS Page Part I: Introduction‐‐Continued HFCS and sugar .................................................................................................................... I‐25 Part II: Conditions of competition in the U.S. market ............................................................ II‐1 U.S. market characteristics ....................................................................................................... II‐1 Channels of distribution ........................................................................................................... II‐1 Geographic distribution ........................................................................................................... II‐1 Supply and demand considerations ......................................................................................... II‐3 U.S. supply ............................................................................................................................ II‐3 U.S. demand ......................................................................................................................... II‐5 Substitutability issues ............................................................................................................... II‐7 Lead times ............................................................................................................................ II‐7 Factors affecting purchasing decisions................................................................................. II‐7 Comparison of U.S.‐produced and imported sugar ............................................................. II‐8 Part III: U.S. producers’ production, shipments, and employment ....................................... III‐1 U.S. sugar beet and sugarcane growers .................................................................................. III‐1 Sugar beet growers.............................................................................................................. III‐1 Sugarcane growers .............................................................................................................. III‐2 Production of sugar beets and sugarcane ........................................................................... III‐2 U.S. sugarcane millers, cane refiners, and sugar beet processors .......................................... III‐4 U.S. production, capacity, and capacity utilization ............................................................... III‐10 U.S. producers’ U.S. shipments and exports ......................................................................... III‐13 U.S. producers’ inventories ................................................................................................... III‐15 U.S. producers’ imports and purchases ................................................................................ III‐15 U.S. employment, wages, and productivity .......................................................................... III‐17 Part IV: U.S. imports, apparent U.S. consumption, and market shares ................................ IV‐1 U.S. importers.......................................................................................................................... IV‐1 U.S. imports ............................................................................................................................. IV‐3 Negligibility .............................................................................................................................. IV‐8 ii CONTENTS Page Determinations ............................................................................................................................... 1 Views of the Commission ............................................................................................................... 3 Part I: Introduction ................................................................................................................ I‐1 Background ................................................................................................................................ I‐1 Statutory criteria and organization of the report ..................................................................... I‐2 Statutory criteria ................................................................................................................... I‐2 Organization of report ........................................................................................................... I‐3 Market summary ....................................................................................................................... I‐3 Summary data and data sources ............................................................................................... I‐4 Previous and related
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