WRAPUP 1-USDA says not in talks to import more sugar

* USDA says routinely contacts suppliers each year

* USDA said in September may require more imports

* US sugar balance not as healthy as USDA indicates-analyst

* USDA wise to wait to determine supply-US sugar group

* Sugar users want imports increased to ensure supply (Adds comment from American Sugar Alliance, Sweetener Users Association)

By Roberta Rampton and David Brough

WASHINGTON/LONDON, Dec 22 (Reuters) - The U.S. Agriculture Department is not in talks with any countries to import additional sugar beyond making routine inquiries about available supplies, a government spokesman said on Tuesday.

A senior trade source told Reuters on Tuesday that USDA had contacted "potential preferential suppliers" to verify how much additional sugar they could supply, noting the suppliers were believed to be based in South and Central America.

But a spokesman for the USDA's Foreign Agriculture Service told Reuters the department has made only routine checks with foreign suppliers about whether they could ship more, should the U.S. import quota be increased.

"This is a routine question asked each year," Harold Kanarek said in an e-mail.

"USDA is not in talks with any countries to import sugar either before or after April 1, 2010 or at any time," he said.

With sugar prices near 28-1/2 year highs, traders are closely watching to see whether the United States allows more than its mandated amount of sugar imports this year.

Raw sugar futures on ICE Futures U.S. <0#SB:> rose more than 3 percent on Tuesday on factors other than the USDA inquiries. [SOF/L]

"I think there is a growing concern that globally, consumption has exceeded production by a significant amount the past two years," said Jack Roney, economist with the American Sugar Alliance, which represents the domestic industry.

Under U.S. law, the department must wait until April before expanding its import quota -- a time when it can better forecast domestic supplies and imports from Mexico, which enter freely under the North American Free Trade Agreement.

"It's wise of the USDA, as the law directs them to, to wait to kind of see how these major variables get settled down ... before they make a call on whether they increase the (quota), and by how much," Roney said. WILL USDA SUPPLY FORECASTS HOLD?

Sugar prices have soared this year because of crop problems in India, the world's No. 1 consumer, and Brazil, the top producer and exporter.

Bad weather also curbed U.S. sugar beet output at a time when U.S. sugar consumption has risen steadily.

Under the U.S. sugar program, the government attempts to balance sugar use with domestic supplies and imports to ensure a minimum price to farmers at no cost to taxpayers.

In August, the department turned down requests from large food companies including Kraft Foods Inc (KFT.N), General Mills (GIS.N) and Hershey Co (HSY.N) for extra imports for the 2008/09 marketing year.

The foodmakers had warned the United States "will virtually run out of sugar" without additional imports. [ID:nN13243671]

For 2009/10, the USDA has forecast the country will be left with 1.016 million short tons (raw value) of sugar stocks at the end of the 2009/10 marketing year, giving it a stocks-to-use ratio of 9.6 percent, down from 13.5 percent in the previous year.

The USDA has said it may need additional imports to ensure adequate supplies this year, but so far has set import quotas for 1.231 million short tons -- the minimum amount required to meet U.S. trade agreements. [ID:nN2891174]

Peter De Klerk, a senior analyst with London-based merchant Czarnikow, said the U.S. sugar balance was not nearly as healthy as the USDA estimated.

U.S. companies that use sugar have said for months the United States will need to import about 850,000 to 1.0 million tonnes of sugar this marketing year to head off shortages. [ID:nN28318336]

"We continue to urge USDA to move quickly to allow additional imports in order to assure adequate supplies of sugar," said a spokeswoman for the Sweetener Users Association. (Additional reporting by Rene Pastor in New York; editing by Keiron Henderson and Lisa Shumaker)