An analysis of possible U.S. sugar import policy revisions

The U.S. sugar import policy, while supporting domestic producers, has had indirect effects on other markets. This study extends previous analyses to look at effects of sugar policy changes from a total agricultural sector perspective. The effects of sugar policy reform are studied with and without changes in farm program provisions for other crops. The results show welfare losses due to the sugar program. It is also shown that reduction of farm programs without altering the sugar quota tilts the terms of trade toward sugar producers giving them a competitive advantage and it is implied that both sets of policies need to be revised simultaneously to avoid distortions between commodities.