(NAFB)--USDA has announced additional actions to address the domestic sugar surplus at the least cost to the federal government. The department sent purchase invitations to domestic sugarcane processors soliciting bids to sell raw cane sugar to the Commodity Credit Corporation. USDA says the CCC will purchase sugar from domestic processors under the Cost Reduction Options of the Food Security Act of 1985 and simultaneously exchange this sugar for credits offered by refiners holding licenses under the Refined Sugar Re-export Program. According to USDA - similar actions last month successfully removed almost 300-thousand metric tons of import supply in exchange for 91-thousand metric tons of CCC inventory for a cost of 43-million dollars - saving an estimated 66.9-million in avoided sugar forfeitures. Tuesday’s action is expected to remove an additional 136-thousand metric tons of import supply of raw cane sugar at a cost of 18.7-million dollars - reducing federal sugar program expenditures by an estimated 37.6-million - which would be incurred if the sugar were forfeited to CCC.
While this invitation will be administered similarly to the purchase announced in June - it is different from the earlier action in that only sugarcane processors may offer to sell sugar because raw cane sugar poses the greatest risk of forfeitures at this time. Another difference from the earlier purchase is that any sugar offered must be under CCC loan.