This is Gwen Outen with the VOA Special English AgricultureReport.
By some measures, these would seem like sweet times for the sugarindustry. The world market for sugar is expanding. So is production.
Developing countries currently produce more than two-thirds ofall sugar. And they are expected to be responsible for almost allproduction growth through two thousand ten. This is shown inresearch by the United Nations Food and Agriculture Organization.
Yet the value of sugar exports has decreased. In nineteen eighty,it was almost ten thousand million dollars. By two thousand one, thevalue of sugar exports fell to six thousand million dollars.
The Food and Agriculture Organization says governmentintervention drives down world sugar prices. It says policies in theUnited States and the European Union are believed to have the mosteffect in limiting chances for growth. It says prices are kept highin their own markets, while prices on the world market aredepressed.
In July of last year, Australia, Brazil and Thailand took actionin the World Trade Organization against the European Union. Thethree nations said European Union countries were giving more aid totheir sugar producers than they had agreed to under W.T.O. rules.They said this aid was unfair and kept world prices down.
Brazil is the biggest producer of sugar from sugar cane. As muchas seventy percent of sugar is made from this plant. France is thebiggest producer of sugar from sugar beets.
Australia, Brazil and Thailand argued that the European Unionguaranteed its sugar producers very high prices within its market.As a result, they said the producers were able to export surplussugar at prices below their cost of production.
Also, the three nations said the European Union was giving moredirect subsidies to its sugar producers than permitted. Thesepayments are based on the amount of sugar imported into the unionunder special trade agreements with some countries. These countriesinclude India, but they are mainly in Africa, the Caribbean and thePacific.
Last month, the W.T.O. ruled the European subsidies illegal. TheEuropean Union immediately said it would appeal. But AgriculturalCommissioner Franz Fischler says the E.U. needs reforms to make itssugar industry “more competitive and trade-friendly.”
This VOA Special English Agriculture Report was written by MarioRitter. This is Gwen Outen.