Domestic Sugar Program-2003 Crop Cane Sugar and Sugar Beet Marketing Allotments and Company Allocations

AGENCY:

Commodity Credit Corporation, USDA.

ACTION:

Notice.

SUMMARY:

The Commodity Credit Corporation (CCC) is issuing this notice which sets forth the establishment and adjustments to the sugar overall allotment quantity for the 2003 crop year (FY 2004), which runs from October 1, 2003 through September 30, 2004. Although CCC already has announced all of the information in this notice, CCC is statutorily required to publish in the Federal Register determinations establishing or adjusting sugar marketing allotments. CCC set the 2003 crop overall allotment quantity (OAQ) of domestic sugar to 8.550 million short tons raw value (STRV) on August 13, 2003. On September 30, 2003, CCC allocated only 96.5% of this amount, resulting in a beet sugar sector allotment of 4.484 million STRV and a cane sugar sector allotment of 3.766 million STRV. At that time, CCC also announced the allotments to cane-producing States and allocations to cane and beet sugar processors and set the proportionate share requirement on Louisiana cane sugar producers for the 2003 crop at 84.2 percent. On April 9, 2004, CCC officially reduced the OAQ to 8.250 million STRV and revised State cane sugar allotments and cane sugar processor allocations to reflect updated FY 2004 raw cane production forecasts. On July 22, 2004, CCC revised State cane sugar allotments to reflect further updated raw cane production forecasts.

ADDRESSES:

Barbara Fecso, Dairy and Sweeteners Analysis Group, Economic Policy and Analysis Staff, Farm Service Agency, USDA, 1400 Independence Avenue, SW., STOP 0516, Washington, DC 20250-0516; telephone (202) 720-4146; FAX (202) 690-1480; e-mail: barbara.fecso@usda.gov.

FOR FURTHER INFORMATION CONTACT:

Barbara Fecso at (202) 720-4146.

SUPPLEMENTARY INFORMATION:

Section 359b(b)(1) of the Agricultural Adjustment Act of 1938, as amended (7 U.S.C. 1359bb(a)(1)), requires the Secretary to establish, by the beginning of each crop year, an appropriate allotment for the marketing by processors of sugar processed from sugar beets and from domestically produced cane sugar at a level the Secretary estimates will result in no forfeitures of sugar to the CCC under the loan program. When CCC announced a 8.550 million ton OAQ in August 2003, it noted the existence of sugar market uncertainties and that the OAQ could be adjusted if warranted. The September 11, 2003, USDA World Agricultural Supply and Demand Estimates forecast substantially decreased total use in FY 2003 and FY 2004. Consequently, the FY 2004 free ending stocks-to-use ratio increased to 17.4 percent, up from 15.1 percent when the OAQ was established. Free ending stocks refer to the portion of stocks that are permitted to be sold under the sugar marketing allotment program. In response, CCC allocated 96.5 percent of the OAQ in September 2003 to reduce the free ending stocks-to-use ratio closer to levels associated with a more balanced market. In April 2004, CCC reevaluated estimates of sugar consumption, stocks, production, and imports and determined that 3.5 percent of the OAQ, or 300,000 tons, that was not allocated in September would not be needed for a balanced market in FY 2004. Thus, the official OAQ was reduced by 300,000 tons. In July 2004, CCC again revised State cane sugar allotments to reflect updated production estimates.

To establish cane state allotments, weights of 25 percent, 25 percent, and 50 percent, respectively, are assigned to the three-factor criteria: Past marketings; processing capacity; and ability to market. Because Puerto Rice forecast zero production for the 2003 crop, its FY 2004 allotment was reassigned to all other cane processors based on their respective three-factor proportionate shares.

Proportionate shares relative to the acreage of cane sugar that may be harvested in Louisiana for sugar or seed is set at 84.2 percent of each farm's cane sugar acreage base. These actions apply to all domestic sugar marketed for human consumption in the United States from October 1, 2003, through September 30, 2004.

The established 2003 crop beet and cane sugar marketing allotments are listed in the following table, along with the adjustments that have occurred since: