The Owosso times. (Owosso, Mich.) 1897-1926, 1917-09-07
THE REPEAL OF THE SUGAR
DRAWBACK

respondence) -Declaring that the re-
peal of paragraph of section of
the tariff act of October 3, 1913, re-
lating to the granting of drawback
upon sugar will injure their business
and that its chief object is to enhance
the price of the sugar output of Loui-
siana, the sugar refiners are deter
mined to oppose this provision of the
revenue bill to defray war expenses.
The report on the new revenue bill
states: Because of the war our al
amounts of beet sugar from Germany
and Austria are now importing large
amounts of refined sugar from the
United States, principally sugar grown
in Cuba and refined in the United
States. All of this sugar being re-
fined from the imported article re-
ceives upon expectation 80 per cent of
the customs duty originally paid upon
it." The Committee comments upon
the enormous purchases by England
and recommends the repeal of the
drawback believing that we will still
continue to supply Great Britain and
our refiners can recoup themselves
from our ally.
With the drawback in force and the
20 per cent reduction on Cuban sugar,
their chief source of raw supply, due
to our reciprocity relations with that
island, the sugar refiners have under
the Democratic law virtually enjoyed
free trade in raw sugar imported for
refining and export. The repeal of
this drawback clause, it is declared
will mean that they will be obliged to
add the duty on the raw price of the
refined sugar. Last year the amount
paid out in drawback amounted to
nearly $14,000,000 and to save this re-
latively small amount to the United
States it is proposed to take it from
the pockets of our Allies, thereby
creating a degree of ill-feeling which
the amount in question does not justi-
fly.
The first effect of this will be to in
duce the British Commission, now
purchasing for the Allies, to pur-
chase raw sugar in Cuba, bidding
against our refiners, and transfer the
business of refining to Canada which
at present has some surplus refining
capacity, while any deficiency in the
refined can be made up by the pur-
chase of direct process white sugars |
or high-grade centrifugals. Certain
Cuban producers have already made |
arrangements to introduce direct pro-
cess methods if the pending measure
goes through and the outcome may be
a permanent restriction of the British |
market for refined sugar. Another |
effect of this proviso, and what is de-
clared to be the underlying motive of |
the Democrats in the Senate, will be |
to force the refiners to buy more ex-
tensively of Louisiana raws, thus
forcing up the price. The western
beet sugar producers, who, under the |
new bill, will have to pay the half
cent excise tax, will be handicapped |
to that extent.
The estimated consumption of SUI
gar in the United States from August |
l to December 81, of this year amounts
to 100000 tons; the estimated bal
ance of refined export to go forward.
to 100000 tons, or a total demand up
to the end of the year of 100000 |
tons. To meet this demand the esti-
mated available domestic tonnage, old |
and new crops, 100000 tons. The
Philippine old crop is about 100000
tons, if it can be gotten here soon,
and there is considerable tonnage of
Javan old crop, but where are the
shipping facilities? 1t is estimated
that Cuba now has available for ex.
port 100000 tons, if we can get it all,
but the British Commission and the
Canada refners have their eyes on
that, and they already hold consid-
cradle amount of raw sugar. 1t is
unlikely that the Commission will, il
Great Britain is to be held up for
the drawback difference trade any of
its raw for our refined for export
sugar. It appears that if the Sen
ate insist on the repeal of the draw
back clause, the increase in price Of
sugar will be greater than the rev.
enue saved.