C.C.C. to buy more domestic sugar
July 24, 2013
by Ron Sterk
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WASHINGTON — The U.S. Department of Agriculture on July 23 issued a second, smaller invitation to buy domestic raw cane sugar to exchange for refined sugar re-export credits in a continued effort to reduce the current domestic sugar surplus.
The C.C.C. seeks to buy 43,046 tonnes of raw cane sugar under the latest invitation. The quantity of sugar offered is due July 25 and the U.S.D.A. will issue a catalog of quantities offered later that same day. Price offers for the quantities in the catalog are due July 29 and successful offerors will be notified July 30.
The U.S.D.A. said it sent invitations to domestic sugarcane processors soliciting bids to sell raw cane sugar to the Farm Service Agency’s Commodity Credit Corp., which will purchase the sugar under the Cost Reduction Options of the Food Security Act of 1985, and simultaneously exchange the sugar for credits offered by refiners holding licenses under the Refined Sugar Re-export Program.
The invitation and exchange will be administered similarly to the purchase announced June 18. Results of that tender were announced July 10 and resulted in the C.C.C. buying about 91,000 tonnes of domestic refined beet and raw cane sugar that were exchanged for re-export credits and resulted in the removal of about 300,000 tonnes of imported supply at a cost of $43 million, but saving an estimated $67 million in avoided sugar forfeitures.
The July 23 action is expected to remove an additional 136,000 tonnes of imported raw cane sugar at a cost of $18.7 million, the U.S.D.A. said, and potentially save $37.6 million in avoided sugar forfeitures.
The latest tender is for raw cane sugar only because raw cane posed the greatest risk for forfeitures at this time, the U.S.D.A. said. The latest tender also requires sugar offered must be pledged as collateral for C.C.C. loans.