Section 1 Short title
This Act may be cited as the “Sugar Policy Modernization Act of 2017”.
Sugar Policy Modernization Act of 2017
A BILL
To modernize the sugar program under the Federal Agriculture Improvement and Reform Act of 1996, to provide for the repeal of the feedstock flexibility program for bioenergy producers under the Farm Security and Rural Investment Act of 2002 and marketing allotments for sugar under the Agricultural Adjustment Act of 1938, and for other purposes.
Sec. 2 Sugar program
Loan rates— Section 156 of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272) is amended by striking subsections (a) and (b) and inserting the following new subsections:
“(a) Sugarcane—The Secretary shall make loans available to processors of domestically grown sugarcane at a rate equal to—
“(1) 18.75 cents per pound for raw cane sugar for the 2018 crop year;
“(2) 18.50 cents per pound for raw cane sugar for the 2019 crop year;
“(3) 18.25 cents per pound for raw cane sugar for the 2020 crop year; and
“(4) 18.00 cents per pound for raw cane sugar for the 2021 through 2023 crop years.
“(b) Sugar beets—The Secretary shall make loans available to processors of domestically grown sugar beets at a rate equal to 128.5 percent of the loan rate per pound of raw cane sugar for the applicable crop year under subsection (a) for each of the 2018 through 2023 crop years.”
Avoiding forfeitures while ensuring adequate supplies at reasonable prices— Section 156(f) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272(f)) is amended—
in the subsection heading, by inserting “While Ensuring Adequate Supplies at Reasonable Prices” after “Forfeitures”; and
in paragraph (1), by inserting “ensure adequate supplies of sugar at reasonable prices and” after “shall”.
Assurance of no net cost and means for recovery of net costs— Section 156(f) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272(f)) is further amended by adding at the end the following new paragraph:
“(3) Assurance of no net cost; recovery of net costs
“(A) Recovery required—Whenever the Secretary finds that, notwithstanding paragraph (1), the program established under this section has resulted in a net cost to the Federal Government, the Secretary shall recover, in a manner determined by the Secretary in regulations prescribed under subparagraph (C), such net cost from processors of domestically grown sugarcane and sugar beets.
“(B) Recovery method—The Secretary may provide for single or multiple payments by each processor of domestically grown sugarcane or sugar beets for the recovery of such net cost under this paragraph.
“(C) Net cost defined—In this paragraph, the term “net cost” refers to a situation in which Federal expenditures (including disbursement of loan proceeds) for a fiscal year pursuant to the program established under this section exceed receipts under such program (including loan repayments) for the same fiscal year.
“(D) Regulations—The Secretary shall issue regulations to carry out this paragraph.
“(E) Application—This paragraph shall apply beginning with the 2019 crop year.”
Effective period— Section 156(i) of the Federal Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7272(i)) is amended by striking “2018” and inserting “2023”.
Sec. 3 One-year extension of feedstock flexibility program for bioenergy producers and subsequent termination
Extension— Section 9010(b) of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8110(b)) is amended—
in paragraph (1)(A), by striking “2018” and inserting “2019”; and
in paragraph (2)(A), by striking “2018” and inserting “2019”.
Termination— Section 9010 of the Farm Security and Rural Investment Act of 2002 (7 U.S.C. 8110) is amended by adding at the end the following new subsection:
“(c) Termination—The Secretary may not carry out the feedstock flexibility program under subsection (b) for the 2020 or subsequent crops of eligible commodities.”
Sec. 4 Two-year extension of marketing allotments for sugar and subsequent administration of tariff-rate quotas
Flexible marketing allotments for sugar—
Sugar estimates— Section 359b(a)(1) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359bb(a)(1)) is amended by striking “2018” and inserting “2020”.
Effective period— Section 359l(a) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359ll(a)) is amended by striking “2018” and inserting “2020”.
Transition to final stocks to use ratio— Section 359k(b) of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359kk(b)) is amended by adding at the end the following new paragraph:
“(3) Stocks-to-use ratio—Notwithstanding paragraphs (1) and (2), the Secretary shall adjust tariff-rate quotas established under subsection (a) in such a manner as to ensure, to the maximum extent practicable, that—
“(A) the final ratio of sugar stocks to total sugar use at the end of a crop year will be approximately—
“(i) 14.5 percent for fiscal year 2019; and
“(ii) 15 percent for fiscal year 2020; and
“(B) stocks of raw cane and refined beet sugar are adequate throughout the crop year to meet the needs of the marketplace, including the efficient utilization of cane refining capacity.”
Repeal and replacement—
In general— Effective October 1, 2020, part VII of subtitle B of title III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359aa et seq.) is amended to read as follows:
“VII Sugar
“359. Administration of tariff-rate quotas
“(a) Establishment—Notwithstanding any other provision of law, at the beginning of fiscal year 2021 and each fiscal year thereafter through the end of the effective period, the Secretary shall establish the tariff-rate quotas for raw cane sugar and refined sugar to provide adequate supplies of sugar at reasonable prices, but at no less than the minimum level necessary to comply with obligations under international trade agreements that have been approved by Congress.
“(b) Adjustment authority—The Secretary shall adjust tariff-rate quotas established under subsection (a) in such a manner as to ensure, to the maximum extent practicable, that—
“(1) the final ratio of sugar stocks to total sugar use at the end of a fiscal year will be approximately 15.5 percent for fiscal year 2021 and each fiscal year thereafter through the end of the effective period; and
“(2) stocks of raw cane and refined beet sugar are adequate throughout the crop year to meet the needs of the marketplace, including the efficient utilization of cane refining capacity.
“(c) Transfer of quota shares
“(1) In general—The Secretary shall promulgate regulations that—
“(A) promote full use of the tariff-rate quotas for raw cane sugar and refined sugar and ensure adequate supplies for cane refiners in the United States;
“(B) provide that any country that has been allocated a share of the quotas may temporarily transfer all or part of the share to any other country that has also been allocated a share of the quotas.
“(2) Transfers voluntary—Any transfer under this subsection shall be valid only pursuant to a voluntary agreement between the transferor and the transferee, consistent with procedures established by the Secretary.
“(3) Limitations on transfers with respect to fiscal year
“(A) In general—Any transfer under this subsection shall be valid only for the duration of the fiscal year during which the transfer is made.
“(B) Following fiscal year—No transfer under this subsection shall affect the share of the quota allocated to the transferor or transferee for the following fiscal year.
“(d) Effective period—This section shall be effective for fiscal years only through the 2023 crop year for sugar.”
Continued application of prior law to certain sugar crops— Part VII of subtitle B of title III of the Agricultural Adjustment Act of 1938 (7 U.S.C. 1359aa et seq.), as in effect on the day before the date specified in paragraph (1), shall continue to apply to the 2019 and 2020 crop years for sugar.
Sec. 5 Sense of Congress
It is the sense of Congress that the President should establish, as major goals of the United States trade policy, the following:
The elimination of all direct and indirect subsidies benefitting the production or export of sugar by any government.
The enforcement, negotiation, and implementation of trade agreements that provide commercially meaningful sugar trade liberalization globally and enhance trade opportunities for United States agriculture and all sectors of the United States economy.