TRADE FIGHT NOT OVER FOR CITRUS, SUGAR

Publication: Palm Beach Post
Printed: Saturday, November 22, 2003
Wrtitten by: Susan Salisbury

MIAMI -- Florida's sugar and citrus industries didn't lose at the Free Trade Area of the Americas talks this week, but they didn't win, either.

The agricultural powerhouses, with a combined economic impact of $12 billion on the state, are fighting to remain viable in the face of increasing foreign competition. Both lead the nation in production of their respective commodities, with 2 million tons of sugar and 252 million 90-pound boxes of oranges forecast for the 2003-04 season.

"Since there is no finality in the agreement, I don't know that anything major has changed," Florida Agriculture Commissioner Charles Bronson said Friday. "It does look like they have set a good format for talks to continue."

Trade ministers from 34 countries in the Western Hemisphere announced Thursday they had reached a sketchy two-part framework agreement for a free-trade bloc throughout the Americas and the Caribbean, except for Cuba. After signing off on a common set of rights and obligations, countries will be able to assume different levels of commitment.

Deputy trade ministers are scheduled to meet in Mexico in February. The negotiators have a little more than a year to deal with the most divisive issues, such as agricultural tariffs, before their self-imposed January 2005 deadline to finalize the pact.

For Florida's sugar and citrus industries, trade issues will continue to consume time, energy and dollars -- potentially for decades.

The fear is that the state's 450,000 acres of sugar cane, the source of income for 25,000 Florida farm families, could lose its market if more foreign sugar is allowed.

The United States imports 1.25 million tons of sugar each year. Industry concerns that those figures could grow deepened this week, as U.S. Trade Representative Robert Zoellick said the United States will initiate bilateral trade agreements with six more sugar cane-growing countries.

"I came in here with an awful lot of concern about market access being discussed at a time when we have a declining market," said Robert Coker, senior vice president for Clewiston-based U.S. Sugar Corp. "I am leaving with the same concerns. Sugar tariff reductions are still not off the table."

For their part, Florida citrus growers say the world-trade playing field is made more level by the 29.7-cents-a-gallon tariff on orange juice from Brazil, the world's largest orange juice producer and exporter.

They believe their strongest argument for not trading away the tariff is that, without it, Florida growers would be forced out of business by cheaper Brazilian juice, leaving Brazil as an orange-growing monopoly.

While the citrus industry is pleased that U.S. trade negotiators said privately this week the citrus tariff could be intact for at least another 10 years, there's no guarantee that won't change.

Terry McCoy, director of the Center for Latin American Studies at the University of Florida, said Florida citrus should begin preparing for an eventual end to the tariff, because free trade is all about market access.

" Ultimately, the citrus tariff will have to go," McCoy said. "What is negotiable is the terms under which it goes."

Some growers got their message directly to trade ministers Wednesday night during a dinner party at Vizcaya.

Ric Freeman, 45, a third-generation orange grower from Orlando, and his wife, Tina, don't usually attend such events, but they feel the future of their groves hinges on preserving the tariff.

Freeman owns 300 acres in Winter Garden. His 70-employee harvesting company P.H. Freeman & Sons Inc. brings in about 1 million boxes a year from his own and other groves.

"I know if we lose the tariff my business will not survive," Freeman said.

Also in Miami this week were two busloads of about 80 sugar company union workers from West Palm Beach-based Florida Crystals Corp. and U.S. Sugar. They marched alongside steelworkers and others Thursday.

"If they take away all the sugar tariffs, our industry will be devastated," said Angel Echenique, 48, a Florida Crystals field mechanic.

"With these kinds of free-trade agreements, it's like creating two classes of people in the United States, the rich and the poor."