2010-24663. Domestic Sugar Program-FY 2010 and FY 2011 Cane Sugar and Beet Sugar Marketing Allotments and Company Allocations

AGENCY:

Commodity Credit Corporation, USDA.

ACTION:

Notice.

SUMMARY:

The Commodity Credit Corporation (CCC) is issuing this notice to publish the modifications to the fiscal year 2010 (FY 2010) State sugar marketing allotments and company allocations to sugarcane and sugar beet processors. This applies to all domestic sugar marketed for human consumption in the United States from October 1, 2009, through September 30, 2010. CCC is also issuing this notice to publish the FY 2011 State sugar marketing allotments and company allocations to sugarcane and sugar beet processors, which apply to all domestic sugar marketed for human consumption in the United States from October 1, 2010, through September 30, 2011. Although CCC already has announced most of the information in this notice through United States Department of Agriculture (USDA) news releases, CCC is required to publish the determinations establishing and adjusting sugar marketing allotments in the Federal Register.

FOR FURTHER INFORMATION CONTACT:

Barbara Fecso, Dairy and Sweeteners Analysis Group, Economic and Policy Analysis Staff, Farm Service Agency, USDA, 1400 Independence Avenue, SW., Mail Stop 0516, Washington, DC 20250-0516; telephone [phone]; FAX [phone]; e-mail: [e-mail].

SUPPLEMENTARY INFORMATION:

Initial FY 2010 State Allotments and Company Allocations

On September 25, 2009, CCC established the initial FY 2010 allocation of the sugar overall allotment quantity (OAQ) at 9,235,250 short tons, raw value (tons). As required by the Agricultural Adjustment Act of 1938, as amended, the sugar beet sector was allotted 54.35 percent of the OAQ (5,019,358 tons), while the cane sugar sector was allotted 45.65 percent (4,215,892 tons). CCC distributed the sector allotments among domestic sugar beet and sugarcane processors according to the statute and the regulations in 7 CFR part 1435 and made several structural changes in the allocation to certain sugarcane processors.

CCC combined the Louisiana cane sugar allocations of Alma Plantation, L.L.C, Cajun Sugar Cooperative, Inc., Cora-Texas Mfg. Co. Inc., Lafourche Sugars, L.L.C., Louisiana Sugar Cane Cooperative, Inc., Lula-Westfield, L.L.C. and St. Mary Sugar Cooperative, Inc. into one allocation under the name of Louisiana Sugar Cane Products, Inc. (LSCPI). CCC also modified the FY 2010 cane sugar allocations of mills in Louisiana to reflect grower petitions to transfer allocation commensurate with their cane deliveries to the new mill of their choice. CCC permanently transferred allocations between Louisiana mills for those growers whose petitions met all CCC requirements. However, for those growers whose petitions did not meet all CCC requirements, CCC temporarily increased the FY 2010 allocations of the recipient mills specified in the petitions. Surplus allocation from Hawaii was reassigned to these recipient mills (see below). The allocations of the mills which the growers asked to leave were not reduced.

In FY 2004, CCC determined that Puerto Rican processors permanently terminated operations because no sugar had been processed for two complete years. The Puerto Rico allocation of 6,356 tons was reassigned to Hawaii in FY 2010, as required, and then further reassigned to the mainland sugarcane-producing States. This reassignment will also occur in FY 2011 as Hawaii is again not expected to use all of its cane sugar allotment.

First Revision to the FY 2010 Sugar Marketing Allotment Program

The May 7, 2010, announcement of sugar marketing allotment changes implemented CCC's reassignment of 200,000 tons of surplus cane sugar allotments to imports, announced on April 23, 2010. The May 7, 2010, revisions included a reassignment of projected surplus beet sugar marketing allocations under the FY 2010 Sugar Marketing Allotment Program from beet sugar processors with surplus allocation to those with deficit allocation. Further, CCC noted the addition of the allocation of Wyoming Sugar Company, LLC (WSC) to the allocation of Minn-Dak Farmers Cooperative (MDFC). This was done in accordance with section 359d(b)(2)(G) of the Agricultural Adjustment Act of 1938, as amended (7 U.S.C. 1359dd(b)(2)(G)) to reflect MDFC's purchase of WSC's Worland, WY, factory in December 2009.

Second Revision to the FY 2010 Sugar Marketing Allotment Program

USDA revised cane processor allocations, and cane State allotments, on August 19, 2010, to implement the July 6, 2010, reassignment of 300,000 tons of surplus domestic cane sugar allotment to a raw Tariff Rate Quota (TRQ) import increase. Since all cane processors were still expected to have more allocation than could be fulfilled by domestically-produced cane sugar in FY 2010, CCC reassigned an additional 200,000 tons of surplus cane allotment to raw cane sugar imports already expected from non-TRQ sources. With respect to the beet sector, CCC on August 19, 2010 reassigned surplus beet sector allotment from beet processors not expected to fill their allocation to beet processors still requiring allocation to market all their FY 2010 supply. CCC then determined that 170,000 tons of beet sugar allotment could not be filled by the beet sector and the surplus was reassigned to raw cane sugar imports already expected from non-TRQ sources. In total, CCC reassigned 670,000 tons of surplus beet and cane sugar allotments to raw cane sugar imports—300,000 tons to an increase in the raw sugar tariff-rate quota per the July 6, 2010, announcement and 370,000 tons to raw cane sugar imports already expected from non-TRQ sources on August 19th. Final FY 2010 beet and cane sector allotments were reduced to 4,849,358 and 3,515,892 tons, respectively.

Initial FY 2011 Sugar Marketing Allotments and Processor Allocations

On August 19, 2010, CCC further announced the initial FY 2011 OAQ of 9,235,250 tons, the same level as FY 2010, as well as sugar beet and sugarcane sector allotments and allocations. Establishing the OAQ at this level will supply over 85 percent of expected FY 2011 domestic sugar needs and permit domestic sugarcane and sugar beet processors to market all of their expected sugar production in FY 2011. Processors are expected to be able to market all of their expected production in FY 2011 because the market is expected to be firm—domestic demand is projected to be strong relative to available supplies and prices are expected to remain firm. Due to this expected firm market situation, CCC announced that it would not implement the Feedstock Flexibility Program (FFP) or the Louisiana Proportionate Share Program for FY 2011. CCC also established a beet allocation for a new beet processor who acquired an existing factory with production history.

On August 19, 2010, CCC distributed the FY 2011 beet sugar allotment of 5,019,358 tons (54.35 percent of the OAQ) among the sugar beet processors and the cane sugar allotment of 4,215,892 tons (45.65 percent of the OAQ) among the sugarcane States and processors, as required by the Agricultural Adjustment Act of 1938, as amended. The accompanying table is identical to the August 19 allotments. The allotments recognize the sale by Minn-Dak Farmers Cooperative (MDFC) of its beet processing factory located in Worland, Wyoming to Wyoming Sugar Growers, LLC (WSG). As a result, 0.8373168 percent of the total beet sugar marketing allotment and the associated production history will be transferred from MDFC to WSG, effective October 1, 2010. In addition, the allotments reflect reassignment of Puerto Rico's allocation of 6,356 tons to Hawaii, and then further reassignment to the mainland sugarcane-producing States, because Hawaii is not expected to use all of its cane sugar allotment.

The summary of the FY 2010 beet and cane sugar marketing allotments and processor allocations are listed in the following table:

FY 2010 Overall Beet/Cane Allotments And Allocations

Distribution	Initial FY 2010 allocation 9/28/09	Revisions 5/7/10	Revisions 8/19/10	Final FY 10 allocations
	Short tons, raw value
Beet Sugar	5,019,358	0	−170,000	4,849,358
Cane Sugar	4,215,892	−200,000	−500,000	3,515,892
Reassignment to Raw TRQ Imports	0	200,000	670,000	870,000
Total OAQ	9,235,250	0	0	9,235,250
Beet Processors' Marketing:
Amalgamated Sugar Co	1,074,683	−17,362	14,327	1,071,647
American Crystal Sugar Co	1,850,519	−51,420	−111,798	1,687,301
Michigan Sugar Co	518,377	69,779	−9	588,146
Minn-Dak Farmers Co-op	321,805	51,988	−41,244	332,549
So. Minn Beet Sugar Co-op	677,454	−21,949	−36,773	618,731
Western Sugar Co	507,709	37,777	5,498	550,984
Wyoming Sugar Co	68,812	−68,812
Total Beet Sugar	5,019,358	0	−170,000	4,849,358
State Cane Sugar Allotments:
Florida	2,094,682	−110,880	−309,097	1,674,705
Louisiana	1,623,713	−42,407	−20,877	1,560,429
Texas	182,094	−3,728	−62,650	115,716
Hawaii	315,403	−42,986	−107,376	165,042
Total Cane Sugar	4,215,892	−200,000	−500,000	3,515,892
Cane Processors' Marketing
Florida:
Florida Crystals	862,435	−58,572	−163,122	640,742
Growers Co-op of Florida	376,802	−15,331	−42,735	318,737
U.S. Sugar Corp	855,444	−36,977	−103,241	−715,226
Total Florida	2,094,682	−110,880	−309,097	1,674,705
Louisiana
Louisiana Sugar Cane Products, Inc.	1,128,210	−19,479	−16,579	1,092,152
M.A. Patout & Sons	495,502	−22,928	−4,298	−468,276
Total Louisiana	1,623,713	−42,407	−20,877	1,560,429
Texas
Rio Grande Valley	182,094	−3,728	−62,650	115,716
Hawaii
Gay & Robinson, Inc	72,401	−18,673	−50,592	3,136
Hawaiian Commercial & Sugar Company	243,002	−24,313	−56,784	161,905
Total Hawaii	315,403	−42,986	−107,376	165,042

The initial FY 2011 sugar marketing State allotments and processor allocations are listed in the table located below:

FY 2011 Overall Beet/Cane Allotments and Allocations

Distribution	Initial FY2011 allocations
	Short tons, raw value
Beet Sugar	5,019,358
Cane Sugar	4,215,892
Total OAQ	9,235,250
Beet Processors' Marketing Allocations:
Amalgamated Sugar Co	1,074,683
American Crystal Sugar Co	1,845,383
Michigan Sugar Co	518,377
Minn-Dak Farmers Co-op	348,589
So. Minn Beet Sugar Co-op	677,454
Western Sugar Co	512,845
Wyoming Sugar Growers, LLC	42,028
Total Beet Sugar	5,019,358
State Cane Sugar Allotments:
Florida	2,094,682
Louisiana	1,620,472
Texas	182,094
Hawaii	318,644
Total Cane Sugar	4,215,892
Cane Processors' Marketing Allocations
Florida:
Florida Crystals	862,435
Growers Co-op. of FL	376,802
U.S. Sugar Corp	855,444
Total Florida	2,094,682
Louisiana:
Louisiana Sugar Cane Products, Inc	1,124,983
M.A. Patout & Sons	495,489
Total Louisiana	1,620,472
Texas:
Rio Grande Valley	182,094
Hawaii:
Gay & Robinson, Inc	73,145
Hawaiian Commercial & Sugar Company	245,499
Total Hawaii	318,644
* The sums of individual entries may not match totals due to rounding.

Signed in Washington, DC, on September 27, 2010.

Jonathan W. Coppess,

Executive Vice President, Commodity Credit Corporation.