U.S. Big Corn goes after old foe, sugar, with new lobbying tactic

CHICAGO (Reuters) - The powerful U.S. corn lobby is launching an unusual offensive against the country’s sugar sector, an old foe in the lucrative sweetener market: seeking to overturn the controversial, near-century old U.S. sugar program.

The Corn Refiners Association, which represents high-fructose corn syrup producers, has hired Washington lobbyist firm, the Alpine Group, to challenge sugar’s long-protected status, a spokesman for the organization said on Thursday.

The sugar program, which restricts imports, sets price floors and provides government-backed loans to cane and beet processors, is considered one of the most generous in the U.S. Farm Bill that passed a year ago.

“The sugar loan program is an embarrassment,” Corn Refiners chief executive officer John Bode said in a statement. Its members include Archer Daniels Midland Co and Cargill Inc.

This is the first time corn refiners have publicly taken the fight to Washington by tackling sugar policy. Corn farmers also benefit from government support programs that keep a floor under prices.

Cane and beet farmers say they need subsidies to ensure the long-term health of industry, which employs thousands of workers across the Midwest and the South. Many also grow corn.

For years, the sugar and high-fructose corn syrup industries have jousted over their share of the massive sweetener market. Yet they also have been aligned in defending sweeteners from critics who say they cause obesity.

The corn lobby will most likely seek to introduce reforms through the Congressional appropriations process, now underway in the House. The Washington Post first reported on the lobbying effort on Thursday.

Phillip Hayes, spokesman for the American Sugar Alliance, which represents sugar growers, declined to comment on the move.

But he said it would be unfortunate if the agricultural sector tried to overhaul policy, aiding “opponents in their quest to gut the safety net on which all U.S. farmers depend.”

Efforts in recent years to repeal sugar policy have failed.

The U.S. sugar industry is a small but powerful group that includes the politically connected Fanjul family, which owns Domino Sugar, C&H, and Florida Crystals.

The sugar sector accounts for a third of campaign donations from U.S. agriculture, while making up only 2 percent of farms, according to the Washington-based Heritage Foundation, a conservative think tank.

“All too often, it has been asserted that the corn industry backs sugar price supports. That is not true and to help get that point across, this year we are working for reform,” Bode said.

Additional reporting by Chris Prentice in Kansas City; Editing by David Gregorio