Proposed Sugar Stabilization Act of 1979

The proposed Sugar Stabilization Act of 1979 (H.R. 2172) would establish a support price of 15.75 cents per pound raw sugar value for the 1978 sugar supply year. There would be two elements: a price objective of 15.25 cents per pound to be achieved by raising the price of imported sugar and thus the domestic price, and supplemental payments of up to one-half cent per pound to processors and/or producers. The proposed legislation would achieve the price support level through import duties and, if necessary, quotas. It would use supplemental payments, and would not restrict the Secretary of Agriculture's authority to operate a loan program. The proposed legislation should have a minimum wage provision for sugar agricultural workers to assure equitable treatment. The International Sugar Agreement, not yet ratified by the Senate, may result, if successful, in higher world prices which would not raise domestic prices if accompanied by reductions in the import fee. Success of the agreement would also assist the domestic industry, and thereby reduce or eliminate the need for direct Federal support. Should the agreement fail, world prices may fall due to the surplus of sugar, and the likelihood exists that the sugar taken off the market through the end of 1978 will be put back on the market. Lower prices will intensify pressure on the Congress to assist the domestic industry and on the President to further raise import fees to compensate for a lower world price.