THE MEXICAN SWEETENERS MARKET AND SUGAR EXPORTS TO THE UNITED STATES

Abstract

This study analyzes the effect of a potential increase in sugar imports from Mexico on the U.S. sugar price, and its consequences for producers and consumers. Additional sugar imports would cause a substantial reduction of sugar prices in the United States and consequently an increase in consumption. Due to low commodity prices, acreage and total production of beet and cane sugar in the United States are expected to fall. Under these circumstances, social welfare in the United States may increase; however, welfare benefits may go to food processors rather than consumer households. By contrast, increases in sugar imports would substantially hurt sugar beet and cane producers.