Page last updated at 17:52 GMT, Thursday, 13 August 2009 18:52 UK

US sugar supplies 'running out'

Sugar cane worker
Global sugar prices have hit 28 year highs

A number of large US food manufacturers have called on the government to ease sugar import limits, saying they fear the country could run out of supplies.

The letter from firms such as Kraft Food and Hershey comes in the week sugar prices have hit 28 year highs due to worldwide supply shortages.

Currently US food firms can only import a certain amount of sugar before they have to pay import tariffs.

US sugar manufacturers insist there is no shortage of domestic stocks.

Imminent sugar harvest

In their letter to US Agriculture Secretary Tom Vilsack, the food firms, which also include General Mills, warned that "our nation will virtually run out of sugar".

There is absolutely no shortage of sugar here
Jack Roney, American Sugar Alliance

However, the US Department of Agriculture said earlier this week that domestic supplies were now increasing.

This was backed by sugar industry group American Sugar Alliance (ASA), which said the next main sugar cane harvest would start later this month, while the sugar beet harvest would begin in October.

"There is absolutely no shortage of sugar here," said Jack Roney, director of economic and policy analysis at the ASA.

Global sugar prices have been pushed up by growing demand in Brazil for sugar to be turned into ethanol for vehicle fuel, and a sharp fall in production in India, the world's largest sugar consumer.

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