Policy pits candy against sugar

WASHINGTON — — Some of Baltimore's best-known candy makers are pressing Congress to overturn a decades-old sugar policy they say is leaving a bad taste in their mouth.

Goetze's Candy Co., Wockenfuss Candies and others want lawmakers to rethink long-standing restrictions on foreign sugar imports that they argue are inflating the cost of making caramels, toffees and chocolates.


The debate between the sugar industry — including the ASR Group, which owns Baltimore's Domino Sugar plant — and confectioners and others who buy sugar by the truckload is expected to come to a head this week in the Senate. Lawmakers are considering changes to the program as part of a $955 billion farm bill that pays for agricultural programs, food stamps and soil conservation.

Paul Wockenfuss, owner and president of Baltimore-based Wockenfuss Candies, said his company buys about 40,000 pounds of sugar a year. His concern boils down to price: Wockenfuss and other confectioners want more access to cheaper, imported sugar.


The limits on imports create an "unlevel playing field," Wockenfuss said. "It's just hurting the smaller businesses."

But sugar industry leaders say they need the controls to compete in a global market in which other countries — particularly those in Latin America — heavily subsidize their sugar crops.

Eliminating protections could drive domestic farmers out of business, they say, and leave U.S. consumers reliant on other countries for their sugar fix.

"The U.S. policy is in direct response to foreign subsidization," said Phillip W. Hayes, a spokesman with the American Sugar Alliance, a coalition of sugar-cane and sugar-beet producers that represents the Domino plant owner and others.

The federal government doesn't provide direct subsidies to sugar farmers, but it has imposed limits on sugar imports since the Great Depression. The U.S. Department of Agriculture provides price-stabilizing loans to sugar growers that can leave taxpayers on the hook when there's a glut in the market, as there has been this year.

The sugar industry employs about 2,600 people in Maryland, Hayes said. The Domino plant — one of the last sugar refineries on the East Coast — employed more than 500 people last year and generated $150 million in economic activity for the city, according to estimates from Domino.

Messages left for a spokeswoman for the Domino plant owner were not returned. The plant manager, Stu FitzGibbon, could not be reached.

Domestic sugar, at just under 27 cents a pound, has been cheaper in recent months than what's available on the worldwide market. But USDA data show that domestic sugar has cost confectioners, bakers and other food makers about 9 cents more on average than imported sugar since 2000.


As in many of the debates over agricultural policy, battle lines in the sugar program tend to be drawn by region rather than political party. The import controls have strong support from Democrats and Republicans alike in cane-producing states such as Louisiana and Florida.

Advocates for changing the system believe their best opportunity may be to amend the farm bill on the Senate floor in coming days. The proposal to do that is being offered by Democratic Sen. Jeanne Shaheen of New Hampshire, but is also supported by Republican Sen. Pat Toomey of Pennsylvania and others in the GOP.

Sen. Barbara A. Mikulski, a Maryland Democrat, called for a "balanced" sugar program, but also described the current structure as "key to ensuring this balance until our international competitors stop receiving government subsidies."

Sen. Ben Cardin also said the U.S. should seek a more level global market. The Maryland Democrat did not say whether he would support the amendment.

"We have worked for years to ensure that both our many beloved candy makers in Maryland, and the Domino Sugar refinery, one of the last on the East Coast, can continue to thrive," he said in a statement.

The Sugar Alliance, which has a powerful lobbying operation in Washington, paid for a study released this month by University of Maryland business professor Alexander J. Triantis, who found sugar-buying businesses have seen sales and profits increase over the past 15 years, despite higher sugar prices.


But supporters of changing the system disputed the findings and suggested that the higher prices have slowed job creation. More than 190 food manufacturers in Maryland purchase sugar in large quantities, the advocates say.

They said their own industries are being squeezed by foreign imports even as the makers of their main ingredient are protected.

Mitchell Goetze, president of Baltimore-based Goetze's Candy Company, rarely speaks publicly about the 118-year-old firm or its trademark caramels. But he traveled to Capitol Hill last week to express his concerns to lawmakers, and has teamed up with trade groups working on the issue in Washington.

Goetze stressed his complaint is with the policy, not Domino or the sugar industry at large.

"We manufacture in a free market, we sell in a free market but unfortunately we can't buy all of our supplies in a free market," he said. "It's an outdated program."