†
145
HR 2419 EAS
‘‘(3) MARKET.—
‘‘(A) IN
GENERAL.—The term ‘market’
means to sell or otherwise dispose of in commerce
in the United States.
‘‘(B) 
INCLUSIONS.—The 
term 
‘market’
includes—
‘‘(i) the forfeiture of sugar under the
loan program for sugar established under
section 156 of the Federal Agriculture Im-
provement and Reform Act of 1996 (7
U.S.C. 7272);
‘‘(ii) with respect to any integrated
processor and refiner, the movement of raw
cane sugar into the refining process; and
‘‘(iii) the sale of sugar for the produc-
tion of ethanol or other bioenergy product,
if the disposition of the sugar is adminis-
tered by the Secretary under section 156(f)
of the Federal Agriculture Improvement and
Reform Act of 1996 (7 U.S.C. 7272(f)).
‘‘(C) MARKETING
YEAR.—Forfeited sugar
described in subparagraph (B)(i) shall be consid-
ered to have been marketed during the crop year
for which a loan is made under the loan pro-
gram described in that subparagraph.’’.
†
146
HR 2419 EAS
(b) 
FLEXIBLE
MARKETING
ALLOTMENTS
FOR
SUGAR.—Section 359b of the Agricultural Adjustment Act
of 1938 (7 U.S.C. 1359bb) is amended to read as follows:
‘‘SEC. 
359b. 
FLEXIBLE 
MARKETING 
ALLOTMENTS 
FOR
SUGAR.
‘‘(a) SUGAR ESTIMATES.—
‘‘(1) IN GENERAL.—Not later than August 1 be-
fore the beginning of each of the 2008 through 2012
crop years for sugarcane and sugar beets, the Sec-
retary shall estimate—
‘‘(A) the quantity of sugar that will be sub-
ject to human consumption in the United States
during the crop year;
‘‘(B) the quantity of sugar that would pro-
vide for reasonable carryover stocks;
‘‘(C) the quantity of sugar that will be
available from carry-in stocks for human con-
sumption in the United States during the crop
year;
‘‘(D) the quantity of sugar that will be
available from the domestic processing of sugar-
cane, sugar beets, and in-process beet sugar; and
‘‘(E) the quantity of sugars, syrups, and
molasses that will be imported for human con-
sumption or to be used for the extraction of
†
147
HR 2419 EAS
sugar for human consumption in the United
States during the crop year, whether the articles
are under a tariff-rate quota or are in excess or
outside of a tariff-rate quota.
‘‘(2) EXCLUSION.—The estimates under this sub-
section shall not apply to sugar imported for the pro-
duction of polyhydric alcohol or to any sugar refined
and reexported in refined form or in products con-
taining sugar.
‘‘(3) REESTIMATES.—The Secretary shall make
reestimates of sugar consumption, stocks, production,
and imports for a crop year as necessary, but not
later than the beginning of each of the second through
fourth quarters of the crop year.
‘‘(b) SUGAR ALLOTMENTS.—
‘‘(1) ESTABLISHMENT.—By the beginning of
each crop year, the Secretary shall establish for that
crop year appropriate allotments under section 359c
for the marketing by processors of sugar processed
from sugar cane or sugar beets or in-process beet
sugar (whether the sugar beets or in-process beet sugar
was produced domestically or imported) at a level
that is—
‘‘(A) sufficient to maintain raw and refined
sugar prices above forfeiture levels so that there
†
148
HR 2419 EAS
will be no forfeitures of sugar to the Commodity
Credit Corporation under the loan program for
sugar established under section 156 of the Fed-
eral Agriculture Improvement and Reform Act of
1996 (7 U.S.C. 7272); but
‘‘(B) not less than 85 percent of the esti-
mated quantity of sugar for domestic human
consumption for the crop year.
‘‘(2) PRODUCTS.—The Secretary may include
sugar products, the majority content of which is su-
crose for human consumption, derived from sugar
cane, sugar beets, molasses, or sugar in the allotments
established under paragraph (1) if the Secretary de-
termines it to be appropriate for purposes of this
part.
‘‘(c) COVERAGE OF ALLOTMENTS.—
‘‘(1) IN
GENERAL.—The marketing allotments
under this part shall apply to the marketing by proc-
essors of sugar intended for domestic human con-
sumption that has been processed from sugar cane,
sugar beets, or in-process beet sugar, whether such
sugar beets or in-process beet sugar was produced do-
mestically or imported.
‘‘(2) EXCEPTIONS.—Consistent with the adminis-
tration of marketing allotments during for each of the
†
149
HR 2419 EAS
2002 through 2007 crop years, the marketing allot-
ments shall not apply to sugar sold—
‘‘(A) to facilitate the exportation of the
sugar to a foreign country, except that the ex-
ports of sugar shall not be eligible to receive cred-
its under reexport programs for refined sugar or
sugar containing products administered by the
Secretary;
‘‘(B) to enable another processor to fulfill an
allocation established for that processor; or
‘‘(C) for uses other than domestic human
consumption, except for the sale of sugar for the
production of ethanol or other bioenergy if the
disposition of the sugar is administered by the
Secretary under section 156(f) of the Federal Ag-
riculture Improvement and Reform Act of 1996
(7 U.S.C. 7272(f)).
‘‘(3) REQUIREMENT.—The sale of sugar described
in paragraph (2)(B) shall be—
‘‘(A) made prior to May 1; and
‘‘(B) reported to the Secretary.
‘‘(d) PROHIBITIONS.—
‘‘(1) IN GENERAL.—During all or part of any
crop year for which marketing allotments have been
established, no processor of sugar beets or sugarcane
†
150
HR 2419 EAS
shall market for domestic human consumption a
quantity of sugar in excess of the allocation estab-
lished for the processor, except—
‘‘(A) to enable another processor to fulfill an
allocation established for that other processor; or
‘‘(B) to facilitate the exportation of the
sugar.
‘‘(2) CIVIL PENALTY.—Any processor who know-
ingly violates paragraph (1) shall be liable to the
Commodity Credit Corporation for a civil penalty in
an amount equal to 3 times the United States market
value, at the time of the commission of the violation,
of that quantity of sugar involved in the violation.’’.
(c) ESTABLISHMENT OF FLEXIBLE MARKETING AL-
LOTMENTS.—Section 359c of the Agricultural Adjustment
Act of 1938 (7 U.S.C. 1359cc) is amended—
(1) by striking subsection (b) and inserting the
following:
‘‘(b) OVERALL ALLOTMENT QUANTITY.—
‘‘(1) IN GENERAL.—The Secretary shall establish
the overall quantity of sugar to be allotted for the
crop year (referred to in this part as the ‘overall al-
lotment quantity’) at a level that is—
‘‘(A) sufficient to maintain raw and refined
sugar prices above forfeiture levels to avoid for-
†
151
HR 2419 EAS
feiture of sugar to the Commodity Credit Cor-
poration; but
‘‘(B) not less than a quantity equal to 85
percent of the estimated quantity of sugar for do-
mestic human consumption for the crop year.
‘‘(2) ADJUSTMENT.—Subject to paragraph (1),
the Secretary shall adjust the overall allotment quan-
tity to maintain—
‘‘(A) raw and refined sugar prices above
forfeiture levels to avoid the forfeiture of sugar to
the Commodity Credit Corporation; and
‘‘(B) adequate supplies of raw and refined
sugar in the domestic market.’’;
(2) in subsection (d)(2), by inserting ‘‘or in-
process beet sugar’’ before the period at the end;
(3) in subsection (g)(1)—
(A) by striking ‘‘(1) IN GENERAL. The Sec-
retary’’ and inserting the following:
‘‘(1) ADJUSTMENTS.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the Secretary’’; and
(B) by adding at the end the following:
‘‘(B) LIMITATION.—In carrying out sub-
paragraph (A), the Secretary may not reduce the
overall allotment quantity to a quantity of less
†
152
HR 2419 EAS
than 85 percent of the estimated quantity of
sugar for domestic human consumption for the
crop year.’’; and
(4) by striking subsection (h).
(d) ALLOCATION OF MARKETING ALLOTMENTS.—Sec-
tion 359d(b) of the Agricultural Adjustment Act of 1938 (7
U.S.C. 1359dd(b)) is amended—
(1) in paragraph (1)(F), by striking ‘‘Except as
otherwise provided in section 359f(c)(8), if’’ and in-
serting ‘‘If’’; and
(2) in paragraph (2), by striking subparagraphs
(H) and (I) and inserting the following:
‘‘(H) NEW
ENTRANTS
STARTING
PRODUC-
TION OR REOPENING FACTORIES.—
‘‘(i) DEFINITION OF NEW ENTRANT.—
‘‘(I) IN
GENERAL.—In this sub-
paragraph, the term ‘new entrant’
means an individual, corporation, or
other entity that—
‘‘(aa) does not have an allo-
cation of the beet sugar allotment
under this part;
‘‘(bb) is not affiliated with
any other individual, corporation,
or entity that has an allocation of
†
153
HR 2419 EAS
beet sugar under this part (re-
ferred to in this clause as a ‘third
party’); and
‘‘(cc) will process sugar beets
produced by sugar beet growers
under contract with the new en-
trant for the production of sugar
at the new or re-opened factory
that is the basis for the new en-
trant allocation.
‘‘(II) AFFILIATION.—For purposes
of subclause (I)(bb), a new entrant and
a third party shall be considered to be
affiliated if—
‘‘(aa) the third party has an
ownership interest in the new en-
trant;
‘‘(bb) the new entrant and
the third party have owners in
common;
‘‘(cc) the third party has the
ability to exercise control over the
new entrant by organizational
rights, contractual rights, or any
other means;
†
154
HR 2419 EAS
‘‘(dd) the third party has a
contractual relationship with the
new entrant by which the new en-
trant will make use of the facili-
ties or assets of the third party; or
‘‘(ee) there are any other
similar circumstances by which
the Secretary determines that the
new entrant and the third party
are affiliated.
‘‘(ii) ALLOCATION FOR A NEW ENTRANT
THAT HAS CONSTRUCTED A NEW FACTORY
OR REOPENED A FACTORY THAT WAS NOT
OPERATED SINCE BEFORE 1998.—If a new
entrant constructs a new sugar beet proc-
essing factory, or acquires and reopens a
sugar beet processing factory that last proc-
essed sugar beets prior to the 1998 crop
year and there is no allocation currently as-
sociated with the factory, the Secretary
shall—
‘‘(I) assign an allocation for beet
sugar to the new entrant that provides
a fair and equitable distribution of the
allocations for beet sugar so as to en-
†
155
HR 2419 EAS
able the new entrant to achieve a fac-
tory utilization rate comparable to the
factory utilization rates of other simi-
larly-situated processors; and
‘‘(II) reduce the allocations for
beet sugar of all other processors on a
pro rata basis to reflect the allocation
to the new entrant.
‘‘(iii) ALLOCATION
FOR
A
NEW
EN-
TRANT THAT HAS ACQUIRED AN EXISTING
FACTORY WITH A PRODUCTION HISTORY.—
‘‘(I) IN GENERAL.—If a new en-
trant acquires an existing factory that
has processed sugar beets from the 1998
or subsequent crop year and has a pro-
duction history, on the mutual agree-
ment of the new entrant and the com-
pany currently holding the allocation
associated with the factory, the Sec-
retary shall transfer to the new entrant
a portion of the allocation of the cur-
rent allocation holder to reflect the his-
torical contribution of the production
of the acquired factory to the total allo-
cation of the current allocation holder.
†
156
HR 2419 EAS
‘‘(II) PROHIBITION.—In the ab-
sence of a mutual agreement described
in subclause (I), the new entrant shall
be ineligible for a beet sugar allocation.
‘‘(iv) APPEALS.—Any decision made
under this subsection may be appealed to
the Secretary in accordance with section
359i.’’.
(e) REASSIGNMENT OF DEFICITS.—Section 359e(b) of
the Agricultural Adjustment Act of 1938 (7 U.S.C.
1359ee(b)) is amended in paragraphs (1)(D) and (2)(C),
by inserting ‘‘of raw cane sugar’’ after ‘‘imports’’ each place
it appears.
(f) PROVISIONS APPLICABLE TO PRODUCERS.—Section
359f(c) of the Agricultural Adjustment Act of 1938 (7
U.S.C. 1359ff(c)) is amended—
(1) by striking paragraph (8);
(2) by redesignating paragraphs (1) through (7)
as paragraphs (2) through (8), respectively;
(3) by inserting before paragraph (2) (as so re-
designated) the following:
‘‘(1) DEFINITION OF SEED.—
‘‘(A) IN GENERAL.—In this subsection, the
term ‘seed’ means only those varieties of seed
that are dedicated to the production of sugarcane