October 31, 2014
Mexico and the U.S. reached a mutual agreement solving a long-fought dispute within hours of the U.S. imposing penalties on import of Mexican sugar. The deal calls for Mexican sugar imports to not be concentrated at certain times of the year, sets limits on the amount of refined sugar that may enter into the U.S. market, and establishes a minimum price of $0.2357 per pound for refined sugar and $0.2075 for raw sugar imports to avoid price undercutting that would artificially keep U.S. prices low. The deal will lend stability and level the market for U.S. farmers and refiners who in March of this year claimed that subsidized sugar from Mexico had cost the industry approximately $1 billion in net income for 2013/14. For the Mexican industry however it will likely mean restrictions on sales to one of its main markets amid the fourth consecutive year of oversupply.
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