According to the Wall Street Journal, the U.S dropped sugar prices by 50% in the last two years but it is not enough for some domestic companies to continue productions of its sugary sweets at home. The beloved Jelly Belly Candy co. is a case in point. Jelly Bell only sells 20% of its sugary sweetness abroad but the company is expanding its foreign production in Thailand, the fourth largest sugar producer, in order to gain access to cheaper sugar. In addition to expanding foreign productions, the company had to increase the price of its candy over the last 10 years in order to account for the higher sugar prices in the U.S.
The U.S currently has a price floor on sugar and limits imports. The article states that “sugar users say the protections inflate wholesale prices, hurt profit margins and sap the competitiveness of U.S candy makers in the global market.” On the global scale, average sugar prices are nearly half the average price of U.S sugar. Defenders of the price policy say, “without the current U.S policy, 90% of the 142,000 sugar-growing and processing jobs in the U.S would be in danger…” With more companies choosing to expand their productions abroad, what will be the implications for the domestic sugar industry? And how will the U.S react?