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 amend the Federal Agriculture Improvement and Reform Act of 1996 to extend and modernize the sugar program, to extend and subsequently repeal the feedstock flexibility program for bioenergy producers, to extend and subsequently replace flexible marketing allotments for sugar, 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:
“(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 each of 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 that is 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 amended by adding at the end the following:
“(3) Assurance of no net cost; recovery of net costs
“(A) Definition of net cost—In this paragraph, the term “net cost” means an amount by which Federal expenditures (including disbursement of loan proceeds) for a fiscal year made pursuant to the program established under this section exceed receipts under that program (including loan repayments) for that fiscal year.
“(B) Recovery required—If 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 that net cost from processors of domestically grown sugarcane and sugar beets in a manner determined by the Secretary in regulations promulgated under subparagraph (D).
“(C) 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 the net cost described in subparagraph (B).
“(D) Regulations—The Secretary shall promulgate such regulations as the Secretary determines are necessary to carry out this paragraph.
“(E) Application—This paragraph shall apply beginning with fiscal year 2019.”
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 paragraphs (1)(A) and (2)(A) by striking “2018” each place it appears 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:
“(c) Termination—The Secretary may not carry out the feedstock flexibility program described in subsection (b) for the 2020 or subsequent crops.”
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 in the matter preceding subparagraph (A) by striking “2018” and inserting “2020”.
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:
“(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 fiscal year is—
“(i) 14.5 percent for fiscal year 2019; and
“(ii) 15 percent for fiscal year 2020; and
“(B) stocks of raw cane sugar and refined beet sugar are adequate throughout each of fiscal years 2019 and 2020 to meet the needs of the marketplace, including the efficient use of raw cane sugar refining capacity.”
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”.
Repeal and replacement—
In general— Effective on 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
“359a. 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 described in subsection (d), the Secretary shall establish tariff-rate quotas for raw cane sugar and refined beet sugar—
“(1) to provide adequate supplies of sugar at reasonable prices; and
“(2) at such levels as are 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 each fiscal year is 15.5 percent; and
“(2) stocks of raw cane and refined beet sugar are adequate throughout each fiscal year to meet the needs of the marketplace, including the efficient use of cane refining capacity.
“(c) Transfer of quota shares
“(1) In general—The Secretary shall promulgate regulations that—
“(A) promote the maximum practicable use of the tariff-rate quotas established under subsection (a);
“(B) ensure adequate supplies of raw cane sugar for cane refiners in the United States; and
“(C) provide that any country that has been allocated a share of the tariff-rate quotas established under subsection (a) may temporarily transfer all or part of the share to any other country that has been allocated a share of the quotas.
“(2) Transfers voluntary—Any transfer under paragraph (1)(C) shall be valid only—
“(A) pursuant to a voluntary agreement between the transferor and the transferee; and
“(B) consistent with procedures established by the Secretary.
“(3) Limitations on transfers with respect to fiscal year
“(A) In general—Any transfer under paragraph (1)(C) shall be valid only for the duration of the fiscal year during which the transfer is made.
“(B) Following fiscal year—No transfer under paragraph (1)(C) shall affect the share of the quota allocated to the transferor or transferee for the next fiscal year after the fiscal year during which the transfer is made.
“(d) Effective period—This section shall be effective only through fiscal year 2023.”
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 sugarcane and sugar beets.
Sec. 5 Sense of Congress
It is the sense of Congress that the President should establish as major goals of the trade policy of the United States—
the elimination of all direct and indirect subsidies benefitting the production or export of sugar by any government; and
the enforcement, negotiation, and implementation of trade agreements that—
provide commercially meaningful sugar trade liberalization globally; and
enhance trade opportunities for the agricultural sector and other sectors of the economy of the United States.